Bressler Risk Blog

When I’ve spoken with many of you about risk software strategy — and in this context I mean new business acceptance — one question consistently looms large: The Cloud. (With AI interest starting to bubble up a bit more these days…)

I’ve heard plenty of anecdotal stories about cloud benefits, costs, opportunities, worries, hopes, dreams, and risks. So the timing feels right to run another Bressler Risk Blog experiment and conduct a new survey. Starting today, qualified participants are invited to participate in the BRB Cloud Risk Software Adoption Survey.

A SAFE PLACE FOR SURVEYING

I want to make it clear that this is an independent survey, untouched by any vendor.

It’s open to all blog readers, regardless of role or title, who work at law firms with at least 100 lawyers, and those of you at similarly sized accounting and consulting firms. (I know you accounting and consulting risk readers are out there! And that the salary surveys have felt a bit exclusionary.)

Similarly, whether you run business intake/conflicts on Aderant, Elite, Fulcrum, Intapp, or iManage — or are planning to move from one on-premises vendor to the another in the cloud — I want to hear from you!

This survey aims to generate valuable aggregate data, and gather helpful peer commentary and feedback.

As I’ve done with the risk salary surveys, responses will be incorporated into the final report in aggregate, without identifying participants. Data will not be shared with any third party — I take your trust and confidentiality concerns quite seriously.

SURVEY TOPICS

Here are the questions, topics, and themes this survey aims to explore and illuminate:

• What’s risk software adoption landscape breakdown today in terms of cloud vs. on premises?
• What’s market penetration like in terms of vendors?

• For firms that have made the jump to the cloud, what was the experience like?
  • How long did the journey take?
  • What costs came with the switch? (Both hard, like additional license fees and consulting services expenses, and soft, like internal resources and change management.)
  • What have the results been?
  • Any amazing advantages? “Home Run” ROI wins? Unexpected barriers, challenges, or lessons learned?
    • In particular, are you using amazing cloud-only features today (e.g. AI)?
• Who have you used for cloud software services migration work (vendor or third party)?
  • What was that experience like?
  • What advice would you give to peers when it comes to selecting and working with vendor or third-party consultants?

• For firms that have NOT yet made the jump to the cloud, what’s you plan?
  • Do you have specific plans and timing in mind to shift? Or are you planning to hold on to on-premises as long as feasible?
  • What are the drivers keeping you on premises/pushing you to make the case to migrate?
  • How expensive do you think migration will be in terms of license uplift, consulting services, and other internal costs?
  • How much time do you think it will take?

SERIOUS ABOUT SURVEY SUCCESS

Will see if we get enough critical mass to generate interesting quantitative or qualitative insight. This only works if people play.

Similarly, I’m not sure at this time if there will be any path for non-participants to get access to the final report. (Many non-participants in the salary survey are finding paths to the results, either by paying a fee for a report/personal benchmark, or via the sponsor channel. I’m increasingly cautious about creating a tragedy of the commons situation…)

So the best way to ensure that you can see the results of this cloud adoption survey, is to participate and contribute to this exercise in good faith!

To support that, as I know that some want to know what they’re getting into before they start a survey, I’ll note that the question set is a more polished distillation of the bulleted list above.

TO ACCESS THE SURVEY

With that, I’m excited to see how this particular experiment plays out. (Maybe there will be more risk experiments in 2026…)

Qualified participants can access the survey here: https://www.surveyhero.com/c/vabtyyzg

Questions? Comments? Feel free to reach out!

“Exxon Drops Paul Weiss, Shifts Climate Suits Defense Work” —

• “Exxon Mobil Corp. is replacing Paul Weiss as its lead legal counsel in US climate change litigation and giving the work to boutique law firm Hueston Hennigan.”
• “The company is making the move for cost purposes and wants more engaged outside counsel at the trial level, according to three people familiar with the matter, who requested anonymity to discuss a change that hasn’t been announced.”
• “The swap in the company’s national coordinating counsel is not related to revelations early this month that former Paul Weiss leader Brad Karp assisted disgraced financier Jeffrey Epstein, according to the people. The disclosures in Justice Department files prompted Karp to step down from his chairman role on Feb. 4.”
• “The move comes as sprawling climate change cases against Exxon and other oil giants play out in different courts, and after Paul Weiss cemented its position as a corporate counsel for Exxon rival Chevron Corp.”
• “Chevron tapped Paul Weiss to handle several major engagements since Barshay was hired, such as its $5 billion acquisition of Noble Energy Inc. in 2020 and an ill-fated $33 billion bid for Anadarko Petroleum Corp. the year prior.”
• “Exxon and Chevron developed a schism in late 2023 that involved access to offshore oilfields in Guyana. Exxon filed an arbitration case that was called one of the most notable disputes in the energy industry in decades.”
• “Exxon lost the 20-month feud and now shares Guyana’s oil-rich coastal waters, a region that neighbors Venezuela, with Chevron and Cnooc Ltd., a Chinese company that merged its arbitration claims with Exxon.”
• “Exxon, however, was never directly adverse to Chevron in the arbitration proceeding, although the latter supported Hess in the matter, said two people familiar with the dispute. Paul Weiss has sought to de-conflict its position between oil and gas titans by handling litigation for Exxon and deal work for Chevron, an arrangement that in the insular US energy sector is not unusual.”
• “‘It’s not uncommon to be friends and allies on one deal and enemies on yet another,’ said Ed Hirs, an energy industry expert at the University of Houston.”
• “Christopher Kulander, a senior lecturer at the University of Texas School of Law and of counsel at Houston’s Oliva Gibbs, said energy companies tend to be most concerned about conflicts in litigation, not deal work, and that despite bitter disagreements on some issues there can still be cooperation elsewhere.”

“Your AI Conversations Are Not Privileged: What a New SDNY Ruling Means for Every Lawyer and Client” —

• “A federal judge just confirmed what many suspected, but few wanted to hear: conversations with AI tools are not protected by attorney-client privilege. On February 10, in United States v. Heppner, Judge Jed Rakoff of the Southern District of New York ruled that dozens of documents a criminal defendant generated using a non-enterprise consumer version of Anthropic’s Claude are neither privileged nor protected as ‘work product.’ The decision is the first of its kind, and its reasoning should affect how every attorney advises clients about AI.”
• “(It also builds on a trend in the same court, where Judge Oetken recently ruled that 20 million ChatGPT conversation logs are likely subject to compelled production in the OpenAI copyright litigation, finding that users have a ‘diminished privacy interest’ in their AI conversations.)”
• “Bradley Heppner, a Dallas financial services executive charged with securities fraud and wire fraud, used the popular AI LLM Claude to research legal questions related to the government’s investigation after receiving a grand jury subpoena and engaging counsel, but before his arrest. He fed information he had learned from his defense counsel at Quinn Emanuel into the AI tool, generated 31 documents of prompts and responses, and then transmitted those documents to his lawyers. When the FBI seized the documents during a search of Heppner’s home, his attorneys asserted the attorney-client privilege and work-product protection.”
• “No attorney was involved. An AI tool is not a lawyer. It has no law license, owes no duty of loyalty, cannot form an attorney-client relationship, and is not bound by confidentiality obligations or professional responsibility rules. Discussing legal matters with an AI platform is legally no different from talking through your case with a friend.”
• “Not for the purpose of obtaining legal advice. Anthropic’s own public materials state that Claude follows the principle of choosing the ‘response that least gives the impression of giving specific legal advice.’ The tool explicitly disclaims providing legal services. You cannot claim you used a tool for legal advice when the tool itself says it does not provide it. Claude’s terms were specifically highlighted by the government, which directly undermined the claim that Heppner was seeking legal advice from the tool.”
• “Not confidential. This is the finding with the broadest implications. Anthropic’s policy expressly states that user prompts and outputs may be disclosed to ‘governmental regulatory authorities’ and used to train the AI model. Judge Rakoff found there was simply no reasonable expectation of confidentiality. As he put it, the tool ‘contains a provision that any information inputted is not confidential.'”
• “This is not unique to Claude. OpenAI’s privacy policy contains comparable provisions permitting data use for model training and disclosure in response to legal process. And the distinction between free and paid plans matters less than many assume. Both Anthropic and OpenAI use conversations from free and individual paid plans (Claude Free, Pro, and Max; ChatGPT Free, Plus, and Pro) for model training by default. Users can opt out, but opting out of training does not eliminate the platforms’ rights to disclose data to government authorities or in response to legal process. Only enterprise-tier agreements (ChatGPT Enterprise and Business; Claude’s commercial and government plans) exclude user data from training by default and offer contractual confidentiality protections. A $20-per-month subscription does not buy you privilege.”
• “Pre-existing documents cannot be retroactively cloaked in privilege. The AI-generated documents were created by Heppner before he transmitted them to counsel. Sending these unprivileged materials to his lawyers after the fact did not retroactively make them privileged. This is a long-settled principle that applies equally to AI outputs.”
• “The work-product doctrine fared no better. Defense counsel conceded that Heppner created the documents ‘of his own volition’ and that the legal team ‘did not direct’ him to run the AI searches. Without attorney direction, work-product protection does not attach. As the government noted, if counsel had directed Heppner to run the AI searches, the analysis might be different.”
• “Judge Rakoff flagged a practical complication the government may not have anticipated. Because the AI documents incorporate information counsel conveyed to Heppner, using those documents at trial could require Heppner’s lawyers to testify about what they told their client. That witness-advocate conflict could cause all kinds of complications. Winning on privilege, the judge warned, does not make the evidentiary picture simple.”
• “Perhaps the most troubling aspect of the ruling is its implication for waiver. Heppner fed information he had received from his attorneys into Claude. The government argued, and Judge Rakoff agreed, that sharing privileged communications with a third-party AI platform may constitute a waiver of the privilege over the original attorney-client communications themselves. The privilege belongs to the client, but so does the responsibility to maintain it.”
• “If you are an attorney: Advise clients explicitly that anything they input into an AI tool may be discoverable and is almost certainly not privileged. Consider putting this in your engagement letters. Make it part of client onboarding. Do not assume clients understand the distinction between a private-feeling interface and an actual confidential communication.”
• “If you manage legal risk: Audit your organization’s AI usage policies. Consumer-grade AI tools with standard terms of service offer no confidentiality protections. Enterprise agreements with contractual confidentiality provisions may change the analysis, but standard accounts do not.”
• “If you use AI for legal work: Understand that the conversational interface creates a dangerous illusion of privacy. Every prompt is a potential disclosure. Every output is a potentially discoverable document.”

“ABA Formal Opinion 521 Re: Judicial Canons of Ethics applying to administrative, supervisory role” —

• “The American Bar Association Standing Committee on Ethics and Professional Responsibility released a formal opinion that provides guidance on the ethical obligations of judges under the ABA Model Code of Judicial Conduct when exercising administrative, employment and supervisory authority.”
• “Formal Opinion 521 says that the canons and rules governing impartiality, integrity and independence — particularly Canons 1 and 2 and associated rules — require judges to administer chambers and court staff with the same fairness and neutrality that guide adjudication. This opinion explains that ethical duties extend beyond the courtroom to include merit-based appointments, the prevention of bias and harassment and the avoidance of favoritism or the appearance of impropriety in all administrative decisions. Judges fulfill these obligations by ensuring that their use of administrative authority promotes public confidence in the judiciary’s independence and integrity.”
• “The opinion notes that ‘Judges occupy a unique public trust: they must decide controversies impartially and must also administer the courts in a manner that sustains the public’s confidence in the independence, integrity and impartiality of the judiciary.’ The Model Code of Judicial Conduct makes plain that those obligations reach beyond adjudication to embrace the full scope of judicial administration. Canon 1 and Rule 1.2 require judges to avoid impropriety and the appearance of impropriety; Canon 2 and Rule 2.3 require that judges perform all duties of office — adjudicative, administrative and supervisory — without bias or prejudice; Rule 2.12 imposes affirmative supervisory duties; and Rule 2.13 requires that appointments be made impartially and on the basis of merit. Together, these provisions create an affirmative, institutionally focused ethical mandate: judges must ensure that both their own conduct and the conduct of those they supervise preserve the fairness and legitimacy of the courts.”
• “Applied here, that mandate means (1) avoiding administrative actions that convey favoritism, partiality or the use of judicial prestige for private ends; (2) making hiring, appointment and personnel decisions on objective, merit-based criteria; and (3) actively supervising and correcting discriminatory, harassingor retaliatory conduct within chambers. The illustrations in this opinion demonstrate how apparently discrete administrative acts (or the failure to act) — when motivated by nepotism, ideology or personal loyalty —can produce precisely the appearance of partiality that the code forbids and how patterns of such conduct can erode institutional integrity even where no single act violates a particular rule.”
• “This opinion affirms that preserving public confidence in the judiciary requires attention to both substance and perception. Judicial fairness must be real, and it must be seen to be real. When judges administer their chambers with impartiality, competence and diligence, they not only fulfill individual ethical obligations but also strengthen the judiciary’s collective standing as an institution worthy of public trust.”
• “The standing committee periodically issues ethics opinions to guide lawyers, courts and the public in interpreting and applying ABA Model Rules of Professional Conduct. Other recent ABA ethics opinions are available here.”

Associate professors Alan B. Clements and Catherine Cleaveland at Kennesaw State University have published an in depth analysis of the landscape and risks facing multidisciplinary account/lawyer practices, worth reading in full for those looking to go into even greater depth: “Blurring the Lines: Multidisciplinary Practice Challenges for CPA Firms” —

• “As CPA firms increasingly seek to provide integrated legal and advisory services, they face a complex web of ethical, legal, and regulatory constraints limiting their ability to operate as true multidisciplinary practices. These barriers stem from a foundational and unresolved conflict between the lawyer’s duty of zealous client advocacy and the auditor’s duty of independence and professional skepticism.
• “The article compares traditional rules with newer experimental frameworks that permit multidisciplinary service delivery through regulatory sandboxes and alternative business structures. It also explores workaround strategies—such as parallel firm models and use of legal consultants—and evaluates the risks these structures may create in this evolving landscape.”
• “For decades, CPAs and attorneys have operated in separate professional silos, each bound by distinct ethical, regulatory, and licensing frameworks. In a world where speed and integration drive business decisions, clients no longer want to juggle multiple advisors: they want solutions, not silos. Whether navigating a merger, responding to regulatory scrutiny, or planning for succession, clients increasingly expect a single team that can handle legal, tax, and financial dimensions. Under a multidisciplinary practice (MDP) model, lawyers, accountants, and consultants collaborate to offer seamless strategic advice.”
• “But as CPA firms explore these one-stop-shop models, they encounter a patchwork of legal and ethical restrictions that complicate and, in many cases, obstruct their path. Rules prohibiting fee-sharing between lawyers and nonlawyers, concerns over attorney-client privilege, and strict definitions of the unauthorized practice of law (UPL) create high-stakes compliance and liability risks.”
• “Even as these barriers persist, the ground is shifting. A growing movement is challenging the long-standing structural rules that have kept the legal and accounting professions apart. At the forefront are the Big Four public accounting firms—PwC, Deloitte, EY, and KPMG—which already offer integrated legal services abroad under more flexible regulatory regimes [e.g., the United Kingdom, Australia, and parts of the EU, where Alternative Business Structures (ABS) are permitted]. These firms are pressing for similar flexibility in the United States, arguing that current restrictions hinder innovation and deny clients the benefits of fully integrated, cross-disciplinary solutions.”
• In February 2025, Arizona’s Supreme Court gave KPMG final clearance to set up a law practice, making the firm the first of the Big Four to do so anywhere in the United States (Mark Maurer, ‘KPMG to Launch US Law Firm Following Court Approval,’ Wall Street Journal, Feb. 27, 2025, https://tinyurl.com/5945bk6e). They are joined by legal technology startups, corporate legal departments, and access-to-justice advocates, all of whom see regulatory reform as essential to modernizing service delivery, expanding access, and responding to the changing needs of clients. Jessica Bednarz has documented legal regulation initiatives in Utah and other states (Unlocking Legal Regulation: Lessons Learned and Recommendations for the Future, Institute for the Advancement of the American Legal System, April 2021). From experimental regulatory sandboxes in Utah to bold licensing reforms in Arizona, the movement for multidisciplinary practice is gaining traction and may soon reshape the professional boundaries that have defined CPA and legal practice for decades (Marilyn Cavicchia, Making Sense of a Shifting Landscape: Sandboxes, Alternative Business Structures, and Regulatory Change, ABA Bar Leader, Sep. 1, 2021).”
  The Regulatory Wall: Core Ethical and Legal Barriers in the United States”
  The foundational divide: advocacy vs. independence.”
• “Before examining the specific rules that create barriers for multidisciplinary practices, it is essential to understand the fundamental philosophical conflict between the duties of lawyers and the duties of auditors. This conceptual divide is the source of many of the regulatory walls that follow.”
• “A lawyer’s ethical obligation is one of undivided loyalty and zealous advocacy for a client’s interests. Whether in contract negotiations or a legal dispute, a lawyer is duty-bound to support and advance the client’s position. This duty is reflected in a client’s own recording and reporting of its financial standing. By contrast, an auditor’s primary duty is to the public trust, which requires independence and professional skepticism regarding a client’s financial information. Auditors are explicitly barred from taking positions of advocacy or, colloquially, ‘auditing their own work.’ This inherent conflict—a lawyer advocating for a client’s position versus an auditor independently scrutinizing that same position—has profound implications for any attempt to combine these services within a single structure.”
• “Before turning to emerging reforms, it is essential to understand the legal and ethical architecture that underpins the status quo in most US jurisdictions. The traditional regulatory framework governing the legal profession was designed to protect clients and uphold professional integrity, but it also creates formidable roadblocks for CPA firms exploring multidisciplinary practice models. Four core restrictions are particularly consequential: the prohibition on non-lawyer ownership and fee-sharing under Rule 5.4, the ban on the UPL, the limited scope of attorney-client privilege in hybrid services, and the heightened risk of conflicts of interest in dual-role relationships. Discussed below, these longstanding rules shape not only what services can be delivered, but also how they are structured, staffed, and marketed.”
• “Conflicts of interest are magnified when professionals wear more than one hat. Lawyers owe clients a fiduciary duty of loyalty and confidentiality. CPAs must adhere to independence standards, especially in audit settings. [See, for example, Model Rules of Pro. Conduct r. 1.7 (ABA 2023), conflicts of interest with current clients and r. 1.10, imputation of conflicts within a firm; and AICPA, Code of Professional Conduct, §§ 1.200.001 & 1.210.010 (2023), establishing independence requirements for CPAs providing attest services, which may conflict with concurrent legal representation.] In multidisciplinary firms, these duties can collide—particularly if one branch of the firm is providing attest services while another offers legal advice in a matter involving the same client. The absence of clear conflict resolution frameworks for MDPs makes regulators cautious and exposes firms to ethics complaints and malpractice risks.”
• “As shown in Exhibit 4, New York and Florida continue to follow traditional rules that strictly limit dual roles. Even if technically allowed, lawyers must avoid blurring the lines between legal advice and other professional services. Arizona and Utah, by contrast, are pioneering MDP-friendly models, with rules designed to allow for conflicts to be identified, disclosed, and ethically waived through compliance programs. For best practice, practitioners should always provide clear written disclosures when acting in multiple roles, obtain client consent, and avoid representing parties with adverse interests—regardless of licensure status.”
• “Despite the formal prohibitions on nonlawyer ownership and fee sharing in most US jurisdictions, professional service firms have long explored creative structures to deliver integrated legal and nonlegal services. These ‘structural workarounds’ aim to capture the client-service benefits of an MDP while nominally adhering to state bar restrictions on the unauthorized practice of law and Rule 5.4 compliance. Conrad J. Jacoby’s ‘Practice Innovations: Non-lawyer Ownership of Law Firms — Are Winds of Change Coming for Rule 5.4?’ examines recent developments in several US states regarding non-lawyer ownership of law firms, (Thomson Reuters, Mar. 29, 2022, https://tinyurl.com/47ujczh7). It is critical to note, however, that while these structures may address rules on ownership and fee-sharing, they cannot resolve the fundamental ethical conflict between a lawyer’s duty of advocacy and an auditor’s duty of independence.”
• “One common workaround involves the formation of two separate, but closely affiliated, entities: a law firm and a CPA or consulting firm, typically under common ownership or management. The law firm provides legal services exclusively through licensed attorneys, while the affiliated firm offers tax, accounting, or advisory services. Although the entities are formally distinct, they often operate from the same location and serve overlapping clients.”
• “To navigate these risks, firms often rely upon careful scoping language in engagement letters to delineate which entity is providing which services (Susan Saab Fortney, ‘The Role of Ethics Audits in Improving Management Systems and Practices: An Empirical Examination of Management-Based Regulation of Law Firms,’ St. Mary’s Journal of Legal Malpractice & Ethics, vol. 4, pp. 112–144, 2014). For example, a CPA firm’s engagement may explicitly disclaim legal advice, while referring legal questions to the affiliated law firm. Such formal separation is essential not only for regulatory compliance, but also for preserving privilege and avoiding conflicts of interest. [see United States v. Kovel, 296 F.2d 918, 922 (2d Cir. 1961); United States v. Richey, 632 F.3d 559 (9th Cir. 2011)].”
• “These structural strategies reflect the growing pressure on professional firms to deliver seamless, multi-disciplinary solutions, despite a regulatory framework that remains wedded to siloed practice models. Whether courts and regulators will continue to tolerate such workarounds—or move to close them—remains an open question, particularly in light of emerging reforms in Utah, Arizona, and abroad.”
• “The longstanding prohibition on MDPs in most US jurisdictions—rooted in Rule 5.4 and traditional notions of lawyer independence—has imposed real limitations on CPA firms seeking to expand into legal services. These restrictions have created a fragmented regulatory environment, deterring innovation and leading many firms to adopt workaround structures that raise their own risks, including potential violations of UPL laws, erosion of privilege protections, and conflicts of interest.”
• “Yet the regulatory landscape is beginning to shift. States like Utah and Arizona have pioneered new models through sandbox regimes and ABS licensing, while internationally the United Kingdom and Australia have long embraced integrated professional service models. These developments signal a growing recognition that rigid silos between professions may no longer serve clients or the public interest in a global, fast-moving advisory marketplace. Ultimately, any successful reform must not only address the structural rules like ABA Model Rule 5.4, but also create coherent frameworks for managing the foundational ethical conflict between a lawyer’s duty of zealous advocacy and an auditor’s duty of independence and skepticism. Navigating this divide remains the central challenge for the future of MDPs in the United States.”
• “For CPA firms considering entry into legal services, the path forward demands strategic evaluation. Firms must assess their risk exposure under current laws, maintain clear ethical boundaries between legal and non-legal services, and ensure that operational models do not inadvertently trigger UPL or privilege waiver issues. At the same time, they should actively monitor state-level reform efforts and be ready to pivot if and when new opportunities emerge.”
• “Ultimately, the convergence of law and accounting is no longer a theoretical debate: it is an unfolding reality. Firms that understand the regulatory terrain and plan proactively will be best positioned to navigate the evolving frontier of MDP services.”

“Former FirstEnergy lawyer says he was troubled by Randazzo agreement” —

• “A former lawyer for FirstEnergy said he wasn’t sure why the company agreed to pay Sam Randazzo hundreds of thousands of dollars each year for five years. Mark Hayden formerly worked as an attorney at FirstEnergy Services Co., a subsidiary of the Akron-based electric utility, supporting the parent company’s former FirstEnergy Solutions power generation subsidiary.”
• “Hayden testified Feb. 9 that he held ‘a number of concerns’ in the 2010s about an agreement that FirstEnergy Services Company had with Sam Randazzo, who at the time was a prominent attorney in the energy space. Later, in 2019, Randazzo became chair of the Public Utilities Commission of Ohio, a state regulatory agency.”
• “Ex-FirstEnergy Senior Vice President Michael Dowling and former FirstEnergy CEO Chuck Jones are accused of bribing Randazzo in their ongoing criminal trial. Randazzo was a defendant in the case before he died in 2024.”
• “For a time, Hayden said, he approved the monthly FirstEnergy Services payments to Sustainability Funding Alliance of Ohio, a shell company that Randazzo owned and controlled.”
• “Testifying as a witness for the prosecution, Hayden said he, Dowling and others at FirstEnergy who worked with Randazzo knew about what the utility called a consulting agreement with Randazzo.”
• “Hayden, who objected to being photographed or recorded in court, said he had numerous issues with the agreement.”
• “For one, Hayden said Randazzo appeared to have a conflict of interest. The utility paid Randazzo at least $25,000 per month while Randazzo represented energy trade group Industrial Energy Users of Ohio, which purchased electricity and generally had different interests than FirstEnergy, Hayden said.”
• “Additionally, Hayden said, the background and purpose of the agreement was not clear to him. And Hayden said Randazzo would reach out to employees of FirstEnergy Solutions ‘as an attorney, knowing that those individuals were represented by counsel.'”
• “The defense contends that the consulting agreement was a legal settlement between FirstEnergy and Industrial Energy Users of Ohio.”
• “In his opening statement on Feb. 3, Assistant Ohio Attorney General Matthew Meyer called the consulting agreement a ‘magic paper’ that the defendants used to create a distraction and conceal the flow of FirstEnergy funds.”
• “Meyer asked Hayden if he had ever seen a settlement in any other context that’s called a ‘consulting agreement.’ Hayden said no.”
• “In an email exchange between Hayden and Dowling presented as a trial exhibit, Hayden expressed his frustration to Dowling about Randazzo’s involvement in FirstEnergy affairs.”
• “Dowling said in an email to Hayden that ‘this has been a problem for more than a decade and probably longer.'”
• “Stamboulidis asked Hayden if Dowling’s statement was in response to Hayden’s concern about Randazzo being a consultant for FirstEnergy Solutions. Hayden said he was generally concerned about the relationship that Randazzo had with the company.”

“Small Deal Won, Big Deal Lost: Inside Big Law’s Eternal Conflicts Dilemma” —

• “Conflicts of interest are a fact of life in legal practice, but they can bite in the most painful places if a firm finds itself conflicted out of big ticket work. There was initial surprise that Linklaters was absent from the recently abortive £260 billion Glencore and Rio Tinto merger talks; according to insiders, the firm was conflicted out, having had to balance its relationships with other major mining companies such as Anglo American.”
• “Though the exact nature of the conflict is unclear, it got the market talking. Here we had a potential £260 billion M&A transaction—before it was halted, it had the makings of the largest transaction anywhere in the world. Ever. Missing out on such a deal can cost a firm in more ways than one: not just in terms of the current fee opportunity, but future opportunities too, with the relationship possibly passing into the hands of a rival.”
• “As consolidation in the market increases, conflicts will inevitably increase in complexity and magnitude. How firms navigate them could be hugely consequential for specific practices but also for the wider firm.”
• “One partner at a top 20 U.K. firm disclosed that they had three deals cancelled already this year due to conflicts; it was simply a fact they had to accept.”
• “Firms have to take precautions to avoid them—not doing so could be costly.”
  “One of the most high-profile conflicts in living memory occurred in 2004 when Slaughter and May successfully obtained an injunction blocking Freshfields from acting for Phillip Green in his £9 billion bid for Marks & Spencer. Freshfields faced a potential conflict as it had previously worked for M&S; the firm argued that it would be able to use a ‘chinese-wall’ during the takeover, a decision the judges called ‘wholly improbable’. Twenty-two years on, and the matter is still remembered, particularly among long-standing City M&A partners.”
• “At most large firms, every new instruction is routed through a dedicated conflicts team, sources say. Teams at multinational firms run 24/7. In the most complicated cases, the question may be kicked upstairs to the conflicts committee or the general counsel. The conflicts committee differs at each firm but generally includes practice heads and senior lawyers deciding the best route for firms to take.”
• “Different jurisdictions are taken into account; conflict laws in the U.S. for instance are more restrictive than those in the U.K.”
• “One partner told Law.com that the worst-case scenario is if a partner gets an opportunity to do some work on a smaller matter, and then the firm is offered the bigger mandate which they then have to turn down. They pointed to finance agreements as being particularly irksome if a big-ticket deal is blocked by some earlier agreement for which the firm was paid a relatively small fee—as little as $3,000, one partner said.”
• “Another senior partner in London at a leading U.S. firm said: ‘Small matters that you take on that then conflicts you out of some big-ticket M&A can be frustrating.’ The partner suggested that one partner trying to hit their targets can then scupper a much bigger, more profitable deal that would benefit the wider firm. ‘What [the firm] can do is it can encourage discipline and good behaviour from its partners, not just thinking of themselves, but thinking of the firm.'”
• While magic circle firms may be more conservative with a centralised system, one partner at a U.S. firm described as a ‘hub and spoke system’, the partner saw U.S. firms as more individualistic and ‘aggressive’ in taking on matters that may eventually lead to conflict risks down the line.”
• “Every partner is under pressure within their firm to bring in their own business. But not all work is created equal.”
  One partner said: ‘It is important that partners are thinking firm first and not just about what’s on their plate.'”
• “A private equity partner placed emphasis on the fact that you not only had to manage relationships between the firm and its clients when it came to conflicts, but between lawyers too, which could be just as complex.”
• “An alternative to flat refusing a deal is to set out to the client as clearly as possible what the firm is able to guarantee and when the firm may act against them. One partner said: ‘If your engagement letter is clear, then you shouldn’t have any issues.'”
  “Partitioning is also a tactic often used by firms to avoid conflicts. By guaranteeing to the client that one team will never see the work that conflicts with the matter, this can serve as a method to ensure the firm can deliver the work. However, this must be established from the start and have client approval from the engagement letter.”

“In pitch-rigging case, Guardians pitcher seeks to shift more blame onto teammate” —

• “In a sign of a growing fissure between two Cleveland Guardians pitchers facing charges tied to a pitch-rigging scheme that benefited gamblers, a lawyer for Luis Ortiz said his client was among those duped by teammate and co-defendant Emmanuel Clase.”
• “In a legal filing unsealed on Monday, in which Ortiz’s representatives asked a federal judge to sever the cases so they could proceed separately, attorney Christos N. Georgalis emphasized the difference in scale between the two pitchers’ alleged participation in the operation. Georgalis characterized Ortiz as ‘a victim of Clase’s scheme, rather than a knowing and willing participant.'”
• “Though the November indictment that brought four federal charges against Clase described nine suspicious pitches he allegedly threw as part of the gambling scheme, prosecutors have opened the possibility that there are more. Attorneys for the government told a federal judge last month they still may identify other pitches and that their investigation is still ongoing. By contrast, Ortiz was accused of rigging two pitches in the indictment and prosecutors said that number has not changed.”
• “Georgalis also cited a potential conflict of interest as justification for severing the cases. The filings detail Clase’s attorneys interviewing witnesses who denied the existence of a betting scheme, but at least one of whom is expected to testify otherwise, according to prosecutors. Even after he was made aware by a judge that the potential conflict of interest could limit how his attorneys question the witnesses they had previously interviewed, Clase elected to stay with his lawyers.”
• “Ortiz’s attorney raised the possibility of serving as a ‘second prosecutor’ and calling Clase’s lawyers to the stand in defense of his client — which he said is an option only if the cases are separated.”
• “One of Ortiz’s ‘likely defenses,’ Georgalis wrote in the filing, is that Clase supplied Ortiz’s pitching strategy to the bettors without his teammate’s knowledge. That approach, Georgalis wrote, ‘is mutually antagonistic to Mr. Clase’s claim of innocence.'”
• “The scheme involved pitchers allegedly predetermining the results of prop bets, as outlined in a 23-page indictment unsealed in November. According to that filing, the ploy netted gamblers winnings of $460,000.”
• “Martin S. Bell, an attorney at Simpson Thatcher and a former federal prosecutor, said there are several reasons why Ortiz could want to sever his case from Clase. Doing so might help Ortiz avoid being prejudiced by the evidence against Clase. The move would also give Ortiz a chance to litigate his case after the government presents their case against Clase at trial, which could be an advantage.”
• “But Bell also noted that, while Ortiz and Clase could still cooperate together in their defense, Ortiz shifting blame to his former teammate also indicates that the parties may be at odds.”
• “‘It’s an interesting posture to be in where you’ve got defendants who are still, in a very important way, sort of on the same boat, but for purposes of this motion, and very possibly for purposes of the practical conduct of a trial, now find themselves, at the very least, on opposite ends with that same boat,’ Bell said. ‘And the question is going to be, is is that boat shaped in such a way that the judge is going to say, ‘Hey, an actual unwarranted injustice would result for making them both go through the trial in that same boat?’'”

“Cadwalader Trial Leaders Resign After Hogan Conflicts Review” —

• “Cadwalader litigation practice leaders Nicholas Gravante and Phil Iovieno resigned on Friday due to conflicts of interest with clients of the firm’s partner in a planned merger, Hogan Lovells.”
• “Litigators Sean O’Shea, Michael Petrella and Matthew Karlan are also leaving, along with corporate partner Nick Ramphal, according to internal emails reviewed by Bloomberg Law. Friday was also their last day, and there’s no word on the six lawyers’ next moves. They didn’t answer comment requests.”
• “Cadwalader said in a statement that the firm expected a few conflicts of interest ‘would be inevitable in the process of creating a global firm with more than 3,100 lawyers.’ It added that ‘we are disappointed that our colleagues will not be a part of the combined firm, but the interests of the clients come first.’ Hogan Lovells declined to comment.”
• “The departures solidify Cadwalader’s shift in focus to complex finance work from litigation as a result of the coming merger. The firms in December announced their plan to create Hogan Lovells Cadwalader, a giant that will generate enough revenue to likely place it among the five largest US firms.”
• “Gravante and some colleagues understood they wouldn’t be able to stay at the firm after a Hogan Lovells merger because of conflicts, according to a person familiar with the matter, who requested anonymity to discuss the departures. Gravante and Iovieno have represented meat buyers in price fixing litigation against meat industry companies that include Hogan clients, the person said.”
• “Hogan CEO Miguel Zaldivar cited Cadwalader’s ‘top of the market finance capabilities’ and growing in New York as his motivation for pursuing the Cadwalader merger. In an interview with the American Lawyer, Zaldivar said partners who Hogan identified as key to the merger, like those who control the bank relationships and sources of revenue, are staying.”

“Judicial Ethics Opinion 25-130” —

• “A judge who receives an insurance reserve balance payment from the judge’s former law firm is disqualified for two years from all cases involving the firm. The two-year period commences from the date of payment. The disqualification is subject to remittal.”

“Judicial Ethics Opinion 25-131” —

• “A judge need not disqualify from a case involving child endangerment charges merely because (a) the judge’s child knows the subject child, (b) the judge’s close friend is engaged to a witness in the case, and (c) the judge recently disqualified him/herself in a different case on other grounds.”

“NY judge took vacations with lawyers, was in text thread filled with ‘off-color jokes,’ ‘sexually graphic images’: officials” —

• “A New York judge took Caribbean vacations with a group of attorneys and engaged in a text message chain featuring ‘off-color jokes’ and ‘sexually graphic images’ with them — helping fuel her hasty retirement, court officials said.”
• “Rockland County Supreme Court Justice Sherri Eisenpress agreed to step down on April 28 over multiple alleged conflicts of interest, the state Commission of Judicial Conduct said Monday.”
• “The CJC said Eisenpress failed to disclose her close personal relationships with the group of attorneys, even as she heard their cases in her courtroom, violating laws that judges must be impartial.”
• “The half dozen lawyers argued in front of Eisenpress between 2019 and 2024 — when they all also traveled to the Dominican Republic, Mexico and the Jersey Shore together at various times, according to the commission.”
  he women were also on a text chain at various times titled ‘Punta Cana Partiers,’ Bougie B*tches’ and ‘Queen Dara and Her Loyal Subjects,’ in reference to the court’s principal attorney, who conducts research, analysis and drafts opinion for judges.”
• “‘[Eisenpress] and the members of the group text message chain … shared confidences and discussed and shared social and travel plans and invitations, gossip, photos, off-color jokes, and sexually graphic images,’ the CJC wrote, outlining its misconduct allegations.”
• “The alleged conflicts didn’t stop there for Eisenpress, who went from family court to state Supreme Court justice during her 15 years on the bench.”
• “Eisenpress was accused of presiding over 41 cases involving the law firm of her principal law clerk’s spouse, while declining to acknowledge the ties or to limit the top aide’s work on those cases, the commission said.”
• “She also handled a matrimonial case in which the lawyer for one of the spouses was co-hosting a fundraiser for Eisenpress’ election campaign — and only recused herself after the opposing counsel called her out, according to the commission.”
• “In 2024, Eisenpress allegedly refused to immediately recuse herself from a case in which her law clerk’s husband represented one of the parties, the CJC said. She later stepped aside for unrelated reasons.”
• “Eisenpress lauded her time on the bench in her resignation letter to Chief Administrative Judge Joseph Zayas on Jan. 29.”
• “‘During my tenure, I was mindful of the responsibility that comes with expanding access to justice and strengthening public trust in the court,’ she said.”

“Johnson & Johnson’s Win Boots Beasley Allen from Talc Suits” —

• “Litigation firm Beasley Allen must stop representing plaintiffs suing Johnson & Johnson over exposure to talc products, a New Jersey state court ruled Friday in a landmark ethics decision.”
• “The ‘prolonged access to J&J’s privileged information, followed by collaborative efforts with its most prominent adversary, leaves us with clear concern for the preservation of trust intrinsic to the attorney-client relationship,’ Superior Court Appellate Division Judge Mark K. Chase wrote Friday.”
• “The ruling validates the pharma giant’s multi-year push to exclude one of the top firms bringing cases in a $22 billion fight over claims that asbestos in talc products contributed to plaintiffs’ vaginal cancer. The parties are awaiting a similar ruling on this issue in the US District Court for the District of New Jersey, and an appeal to the New Jersey Supreme Court is expected.”
• “‘‘Switching sides’ against a former client does not present a close call—but rather a bright-line ethical prohibition recognized by every court, every ethics authority, and, frankly, every first-year law student,’ Erik Haas, Johnson & Johnson’s worldwide vice president of litigation, said in a statement.”
• “The appeals court ruled that former Sidley Austin attorney James Conlan ‘associated’ with the Beasley Allen during a mediation over J&J’s bankruptcy plans. Despite Conlan was acting as a nonlawyer on behalf of his mass tort consulting business Legacy Liability Solutions, there was a clear conflict warranting kicking Beasley Allen out of the litigation where it’s one of the top players.”
• “‘It is clear Conlan and Beasley Allen worked together over several months by ‘join[ing] or unit[ing]’ with Conlan for the same common purpose, to have the matter resolved by structural optimization,’ Chase said. ‘Thus, Beasley Allen associated with Legacy and Conlan for purposes’ of New Jersey ethics standards.”
• “Beasley Allen’s lawyer Jeffrey Pollock promised an appeal. Since this is a published opinion, the New Jersey Supreme Court is rule-bound to review the decision.”
• “‘We respectfully but vehemently disagree with the Court’s analysis and its conclusions,’ Pollock, managing member of Pollock Law LLC, said in an email. ‘This Opinion re-writes the Rules of Professional Conduct and cannot stand.'”
• “At oral argument in January, J&J said keeping Beasley Allen in the mix would send a broader message to the legal community that there are loopholes: lawyers like Conlan—who had insider information central to J&J’s defense—could somehow find ways to work with the very firms now suing his former client.”
• “Even though the rules aren’t as strict for non-attorneys, the court said this behavior would interfere with clients ability to retain the lawyer of their choosing and entrust them with confidential information.”
• “‘Beasley Allen knowingly collaborated with Conlan on the same issue and in the same litigation that Conlan represented its adversary—J&J. ‘The rules of professional behavior are not branches which bend and sway in the winds of the job market’ but are instead ‘the bedrock of professional conduct,’’ Chase said, quoting state high court precedent.”

“Huitron v. Toby (Ga. 2026): Potential Appellate-Counsel Office Conflicts Require Proof of a Specific, Adversely Affected Appellate Decision” —

• “Huitron v. Toby, Warden arises from Alexandro Huitron’s habeas challenge to his convictions for felony murder and related offenses connected to the death of his three-year-old daughter, Esmerelda Gomez. After the Supreme Court of Georgia affirmed the convictions on direct appeal in Gomez v. State, 301 Ga. 445 (2017), Huitron filed a habeas petition alleging, among other things, that his appellate counsel (John Kraus) labored under a conflict of interest.”
• “The claimed conflict stemmed from office affiliation: Kraus worked in the Clayton County Public Defender’s Office, and that same office represented Huitron’s co-defendant and wife, Margarita Gomez, at their joint trial. Huitron contended that this relationship prevented Kraus from investigating and litigating a more forceful ‘Gomez-did-it’ theory via an ineffective-assistance claim against trial counsel, including by calling Gomez to testify at the motion-for-new-trial stage.”
• “The central legal issue was not whether the office relationship created any professional tension, but whether Huitron proved an actual conflict of interest that significantly and adversely affected appellate counsel’s performance—entitling him to a new, conflict-free direct appeal.”
• “The Supreme Court of Georgia affirmed the denial of habeas relief. Even assuming a potential conflict existed, the Court held the habeas record supported the finding that the alleged conflict did not significantly and adversely affect Kraus’s appellate representation. Critically, Huitron failed to connect the alleged conflict to a concrete, foregone, potentially meritorious appellate action—such as a specific ineffective-assistance theory that Kraus declined to raise because of divided loyalties.”
• “The Court emphasized that Georgia conflict-of-interest ineffectiveness claims turn on whether the conflict palpably affected performance, not on abstract office relationships or speculative assertions that counsel felt ‘hamstrung.'”