Bressler Risk Blog

“Texas Doc Claims Atty Had Conflict In Whistleblower Case” —

• “A Texas doctor who was hit with a judgment of more than $2.5 million is claiming in a new lawsuit that his interests were in conflict with other defendants also represented by his former lawyer, who is now a senior counsel with Clark Hill PLC.”
• “Dr. Emelike Agomo alleges that Lara Maria Longo, formerly Lara Maria Silva of the Silva Law Firm, should not have represented him while also representing his then-employer Outreach Eye Care because he was a salaried employee who had little to do with the fraudulent billing that led to the multimillion-dollar judgment for False Claims Act violations in the Southern District of Texas.”
• “In the complaint filed Friday in a Texas district court in Harris County, Agomo claims Longo is guilty of malpractice and breach of fiduciary duty.”
• “U.S. District Judge Lynn N. Hughes found Agomo and the owner of Outreach Eye Care, Dr. Mustapha Kibirige, liable for wrongful billing to Medicare for glaucoma testing in an order granting partial summary judgment in March 2020. The relator in the whistleblower suit is an optometrist who alleged that he repeatedly told Agomo, the clinic’s former medical director, that the procedure they were billing for wasn’t authorized under the medical code they were using and which resulted in fraudulently obtained payments from Medicare.”
• “Agomo said Longo’s representation fell below acceptable standards for attorneys when she took him on as a client along with co-defendants whose interests were in conflict with his and when she failed to ‘disclose and inform’ him of the conflict.”
• “Agomo further faults Longo for keeping him ‘entangled’ with his former employer and for ‘failing to withdraw as soon as she came to the knowledge that the plaintiffs in the underlying action sought to nail Dr. Agomo with a humongous judgment along with the other co-defendants.'”

“Law firm Kirkland cleared to represent bankrupt 3M earplug subsidiary” —

• “A U.S. bankruptcy judge on Thursday allowed Kirkland & Ellis to continue representing bankrupt 3M subsidiary Aearo Technologies, rejecting calls to disqualify the firm because of its work defending 3M in a massive litigation over allegedly defective military earplugs.”
• “U.S. Bankruptcy Judge Jeffrey Graham in Indianapolis said that Aearo and 3M do not have conflicting interests, as both companies are working to reach a bankruptcy settlement that would resolve more than 200,000 lawsuits they are facing alleging that 3M’s earplugs contributed to veterans’ hearing loss.”
• “A conflict could arise in the future, if, for example, Aearo and 3M disagreed about the terms of a future settlement, Graham said. If that happened, Kirkland could face disqualification, loss of fees, or even potentially the dismissal of Aearo’s bankruptcy case, according to the judge.”
• “‘Kirkland & Ellis is navigating a minefield,’ Graham said. ‘This isn’t a blanket endorsement saying that K&E is in the driver’s seat no matter what happens in the future.'”
• “Kirkland’s Mark McKane told Graham that his firm’s deep knowledge of the earplug litigation would benefit Aearo’s restructuring effort, and that the firm had put guardrails in place to prevent future conflicts from derailing the case.”
• “Kirkland has defended 3M in the MDL, and it represents Aearo in the bankruptcy case that was meant to spur a settlement of the earplug lawsuits. Aearo’s bankruptcy filing failed to pause the lawsuits against 3M, and the bankruptcy is proceeding in parallel with consolidated litigation in Florida federal court.”
• “The plaintiffs and the U.S. Department of Justice’s bankruptcy watchdog sought to disqualify Kirkland from representing Aearo in the bankruptcy, saying it could not faithfully serve both Aearo and 3M.”

“Managing and mitigating conflicts of interests in GP-led transactions” —

• “GP-led secondary transactions enable a sponsor or general partner (GP) to manage one or more existing assets in a newly formed fund capitalized by new investors through a fund restructuring. These transactions are often proffered as a win-win-win — for GPs, investors and buyers — but as the market continues to expand against a backdrop of increased regulatory scrutiny, navigating the conflicts of interests has become increasingly important. This article explores key considerations in managing conflicts of interests in GP-led transactions.”
• “GP-led transactions present an inherent conflict of interest due to the GP’s position as both seller and buyer… To further complicate the web of conflicts, GPs may offer co-investment or staple investment opportunities for other funds managed by the GP as part of the transaction.”
• “One of the first steps a GP should take in mitigating conflicts is to survey the governing documents relevant to the existing fund, including the operating agreements, side letters, offering documents, other fund documents and underlying asset documents. These documents may contain provisions concerning restrictions, rights and obligations relevant to the transaction, including clawback obligations, consent requirements, rights of first refusal and tag and drag rights.”
• “Legal diligence of the fund documents can also unveil whether amendments will be required and provide guidance on the voting requirements for the limited partner advisory committee (LPAC).”
• “An important role of the LPAC in any private fund is to advise on conflicts for related-party transactions. As such, another important early step in managing conflicts is engaging the LPAC to ultimately obtain its waiver of any conflict.”
• “Many GPs approach the LPAC for informal approval in the early stages of exploring a transaction before the sale process is actually initiated and then obtain formal approval once bids from prospective buyers are received.”
• “Certain LPAC members may need to recuse themselves from the formal approval if their institution intends to participate as a prospective buyer. While the LPAC is not charged with approving the terms or price of the transaction, full and fair disclosure of all material terms of the transaction and potential conflicts of interests is essential.”
• “The LPAC will want to understand why the proposed transaction is the best option for existing investors and what price discovery methods the GP intends to employ. In some instances, the LPAC may request a fairness opinion or third-party valuation.”
• “A fairness opinion is produced by an independent opinion provider or valuation agent and opines on whether the price being offered is within a fair range. Typically, the opinion is accompanied by a valuation report focused on pricing the target assets. While fairness opinions are used to help mitigate conflicts of interest, they do not necessarily ensure the highest price and other price legitimization tools exist.”
• “Recently, some GPs have coupled the GP-led auction process with a minority direct sale to a third party. If the GP ran a direct sale process to no avail or the price offered in connection with the GP-led sale process is better, these facts also help mitigate concerns around conflicts of interest with respect to price.”
• “Offering existing investors the opportunity to roll on the same economic terms and conditions as the existing fund (a ‘status quo’ option) can also mitigate conflicts of interest.”
• “In order to successfully navigate the conflicts of interest present in GP-led transactions, GPs must carefully consider the various mitigation tools available and tailor their approach based on the specific conflicts present.”

“How to Stop Having to Write and Send Declination Letters” —

• “Declination letters, also referred to as non-engagement letters, are those letters that say, “thanks, but no.” Some lawyers use them religiously and others not so much. Those in the not-so-much crowd apparently just don’t see the need and the excuses vary. Such letters may be viewed as unwarranted in most matters, irrelevant, or not cost-effective in terms of the necessary time and energy to prepare.”
• “If you count yourself as a proud member of the not-so-much crowd, you need to hearthat those excuses are just that, excuses. Declination letters have their place as an effective risk management tool. As such, they should never be dismissed out of hand because the failure to write and send one of these letters can pave the way for a viable malpractice claim.”
• “While I will readily admit that the number of malpractice claims that arise as the result of a failure to write and send out a declination letter isn’t large, this doesn’t mean we never see them. We certainly do. Sometimes these claims are the result of a missed conflict of interest. In short, the creation of a declination letter was what normally would trigger the entering of the name of a declined client into the conflict database. No letter, no name entry, no memory, and no hit when a name search is eventually run. Whoops.”
• “More frequently, the claim involves an allegation of failing to move a matter forward in some fashion. Most concerning are the times when the claim is made after a statute of limitations date has run. Of course, the subject lawyer will always state there was never any obligation to do anything further and the prospective client will always claim otherwise. Here’s the problem. If the lawyer is unable to provide documentation that an attorney-client relationship never was established, which is exactly what declination letters do, this lawyer will be facing an uphill battle.”
• “Lawyers often use a client intake form during the initial consultation. If you do so as well, consider making a few modifications to this form that will allow you to use it to conveniently document an engagement or declination. At the conclusion of the initial consultation, give the prospective client a copy of the client intake form, and then you and your prospective client will sign both the copy and the original.”
• “And then at the end of the client intake form, you would add something similar to the following… If I do not agree to represent you, then we have not formed an attorney-client relationship, even though we had this initial consultation. Neither this firm nor I will represent you on the matters set forth in this client intake form or discussed during this initial consultation… By signing below, you acknowledge that you have received a copy of this completed client intake form. Your signature also confirms that you understand that I have not been hired as your attorney and that this firm will take no further actions on your behalf.”

“US Courts Begin Posting Judge Stock Disclosures Online” —

• “An online database for tracking stock and other financial disclosures by federal judges went live Monday, a congressionally mandated site aimed at making information about courts more accessible to the public.”
• “The database includes annual financial disclosure reports and periodic disclosures for transactions over $1,000 for federal judges for 2021 and 2022. It comes two days ahead of a deadline set by Congress to create such a database as part of a law, the Courthouse Ethics and Transparency Act (P.L. 117-125), enacted in May. “
• “The database was praised as progress by advocates, who also pointed out shortcomings like the number of steps users must take to access records. Currently, 600 of about 2,400 reports have been filed, with more coming, a spokesman for the Administrative Office of the US Courts said.”
• “Congressional efforts to require the judiciary to create a financial disclosure database came after the Wall Street Journal reported that more than 130 federal judges failed to recuse in cases where they or a family member had a financial stake.”

“Dentons Loses $32 Million Challenge to Swiss Law Firm Model” —

• “Dentons lost its latest bid to overturn a $32.3 million legal malpractice award it must pay a former client.”
• “The Ohio Supreme Court’s decision Tuesday could have implications for the Swiss verein law firm ownership model used by Dentons and other major firms. Swiss verien firms market services from loosely affiliated legal operations under a single brand.”
• “The ruling treats affiliated firms as the same entity for conflict-of-interest purposes. That means firms will have to drop clients or sit out matters if there is a conflict based on work that affiliates are doing for other clients.”
• “The high court declined to reconsider the award for RevoLaze Inc., a former Dentons client. A state court ruled that Dentons had a conflict of interest when it represented RevoLaze because a Dentons affiliate in Canada represented Gap Inc., which RevoLaze had sued for patent infringement.”
• “At least six major US law firms have adopted the Swiss verein model, including DLA Piper, Squire Patton Boggs, Baker McKenzie, Norton Rose Fulbright and Littler Mendelson.”
• “Dentons global chairman Joe Andrew said in July interview that the firm isn’t considering changing its ownership model, which has allowed for rapid growth. He also suggested that the firm could try to take its case to federal court.”
• “Swiss verein firms are not likely to overhaul their business structures as a result of the decision, according to Cassandra Burke Robertson, director of the center for professional ethics at Case Western Reserve University School of Law, ‘The potential risk of liability for conflict of interest can be managed separately, either by seeking client consent to waive potential conflicts or to limit the clients that are accepted by the firm,’ she said via email.”
• “The case may, however, serve as a ‘cautionary note,’ Robertson said. The ruling encourages firms to conduct careful conflicts reviews before accepting a new client, she said, and to make a full disclosure to clients in the event that a conflict arises after representation has begun. “

“Brooke Jenkins Swears She Did Not Violate Ethics in Case Involving Family Member’s Killing” —

• “San Francisco District Attorney Brooke Jenkins swore under oath that she did not violate any ethical rules in a murder case where the victim was a member of her family, a filing obtained by The Standard shows.”
• “The case—one of two in which Jenkins has a conflict of interest—involves the alleged killers of 18-year-old Jerome Mallory, her husband’s cousin.”
• “‘I have never breached the ethical wall in this case,’ Jenkins said in a sworn declaration filed in the case. ‘I have never accessed any district attorney files, papers or electronic, or investigative files, and did not direct the investigation of this case in any way or attempt to influence the production of this case.'”
• “…Attorney General Rob Bonta has weighed in, arguing that the existing ethical walls—systems in place that limit Jenkins’ personal interactions with the case—erected before and after Jenkins took office, are sufficient for fair trials.”
• “Now, defense attorneys have filed a recusal motion, asking a judge to make the final decision on who handles the case.”
• “After Jenkins left the District Attorney’s Office in October 2021, she began working to oust her former boss Chesa Boudin, in a successful June recall campaign. In that time, she made public statements about how she thought that Boudin was not handling the Mallory case appropriately.”
• “Pam Herzig, who is representing Mitchell, said in court Monday that the central issue is the public statements Jenkins made about the case after she left the DA’s Office. ‘The court can’t take her at her word,’ said Herzig about Jenkins’ declaration.”
• “A lawyer for the Attorney General’s Office argued to the court that defense attorneys require proof via declaration that ethical walls were breached, not simply public statements made by Jenkins.”

“Ohio ethics opinion provides valuable insight on office-sharing considerations” —

• “Earlier this month, the Ohio Board of Professional Conduct (‘Board’) issued an Opinion which provides guidance to attorneys engaged or contemplating engaging in an office-sharing arrangement.”
• “While nonlawyer staff can generally be shared, there are limitations. The Board cites Ky. Ethics Op. E-406 and cautions that when lawyers sharing office space represent adverse clients in a matter, the same nonlawyer staff member cannot be assigned to both lawyers during the representation.”
• “The Board recommends implementing a written policy to identify conflicts when office sharing lawyers do use the same nonlawyer staff.”
• “And though not addressed in the Opinion, one could certainly imagine problems, even disqualification, if steps are not implemented to ensure that documents are not segregated from staff working for adverse parties.”
• “The Board recommends separating and safeguarding electronic and physical client files from other lawyers’ filing systems, keeping all in-person, telephonic, electronic, and written communications regarding clients in a manner to prevent unintentional disclosure; and ensuring that staff and lawyers alike refrain from communicating with or about clients in waiting and common areas. Lawyers should train nonlawyers staff on how to protect confidential client information.”
• “DC’s Opinion 303 reminds lawyers that office sharing arrangements by unaffiliated attorneys can create a risk of public

An interesting potential term of engagement I’ve not seen discussed in the context of OCGs caught my eye, via the team at Osler: “A fresh take on applying decision trees to case assessments in litigation” —

• “Although the idea of applying decision trees to civil litigation has been around for decades, most litigators have not integrated them into their practice. The reasons for this vary, including lawyers reluctant to think and communicate in term of numerical probabilities.”
• “Using decision trees to model litigation gives lawyers an opportunity to communicate their case assessments in a compelling, client-centric way. Decision trees allow lawyers to explain a dispute visually, with easily digestible language and numbers. A single page can convey as much information as a lengthy written opinion. Advances in technology has made it easier for lawyers to develop decision trees and share them with clients”
• “…using modern decision tree software typically requires minimal additional training. Law firm lawyers should also be reminded, prior to modelling any client’s matter, to check the client’s outside counsel guidelines to confirm using the software is permissible. In some instances, client consent may be required.”

“Freeman Mathis Booted Off Suit Due To Atty ‘Switching Sides’” —

• “A Georgia federal judge disqualified Freeman Mathis & Gary LLP from continuing to represent the Geo D. Warthen Bank against age and sex discrimination claims from a former employee, ruling that the former employee’s attorney created a conflict of interest when she moved to Freeman Mathis during the dispute.”
• “Helton sued the bank, located in the city of Sandersville, in November 2021, alleging that the bank had violated the Age Discrimination in Employment Act and Title VII of the Civil Rights Act when it terminated her as vice president and compliance officer in October 2019. Judge Treadwell found that Emily Walker, now a Freeman Mathis associate, created a conflict that extended to Freeman Mathis when she joined the firm in August and didn’t seek a waiver from Helton.”
• “When Walker was an associate at Cooper Barton & Cooper, she helped represent Helton against the bank.”
• “‘In the court’s experience, rare is the client who would feel comfortable with her lawyer switching sides… Because Walker’s departure from Cooper Barton to FMG created an imputed conflict that Helton did not waive, and which could not be screened, FMG is no longer permitted to represent Warthen in this case,’ Judge Treadwell said.”
• “The judge also found that the conflict cannot be remedied by Freeman Mathis’ blocking of Walker from the bank’s defense against Helton.”
• “‘While the court agrees that screening Walker was sensible, it does not affect the outcome,’ Judge Treadwell said. ‘As Helton points out, the [Georgia professional rules] and the case law interpreting those rules are clear— ‘screening procedures will not cure the imputation of the conflict.””

“Ethics: Protect Your Electronic Contact List from Prying Eyes” —

• “…a new [April 2022] legal ethics opinion issued by the New York State Bar Association’s Committee on Professional Ethics. Opinion 1240 has this digest statement: ‘If ‘contacts’ on a lawyer’s smartphone include any client whose identity or other information is confidential under Rule 1.6, then the lawyer may not consent to share contacts with a smartphone app unless the lawyer concludes that no human being will view that confidential information, and that the information will not be sold or transferred to additional third parties, without the client’s consent.'”
• “All lawyers likely have the client’s name, office and cell numbers, email and physical address, and job title. But many keep other information in the Notes field of Outlook, including such things as nicknames, anniversaries, birthdays, spouse’s name, names of children, pet names. etc. If you click on “Details” in the ribbon, you have a specific form for entering certain details, but most lawyers, in our experience, simply dump the information into the Notes field when they create a new contact.”
• “Because we do digital forensics, we can tell you that there is often a lot of information in the Notes field, including passwords, social security numbers, building access codes, and a lot of other private information which the attorney wants readily at hand.”
• “Many lawyers have no clue that apps can potentially see all that information if you grant them access. A quick search on Google shows that Venmo, Facebook, Zoom, Snap, Slack, Tinder, Signal, Pinterest, Telegram, Chase Bank, Wayfair and even Samsung’s smart washer will ask you for access to your Contacts. The list of apps seeking access to your Contacts is undoubtedly huge.”
• “Sometimes, apps will restrict access. In iOS, third-party apps with permission can access any contact field, except for the Notes section, which requires additional approval from Apple. The company added that restriction in 2019, but it declines to say how many or which apps are cleared to access Notes.”
• “Some will access just the basics – name, phone numbers and email address. Others will take anything they can get. Disabling the app’s privileges doesn’t necessarily result in the app deleting information it already has. An app may – or may not- give you instructions on how to delete previously obtained information.”
• “Perhaps more significantly to lawyers, contacts have been leaked in data breaches. Once those Contacts are out there, there is no way to call them back. They almost certainly will be misused. Wire fraud and business email compromises are frequently the objectives.”

“Kanye West will likely have a hard time finding new divorce lawyer: experts” —

• “Kanye West will likely have a hard time finding a new attorney in his divorce from Kim Kardashian — as a problematic client who’d already cycled through several law firms before the latest ones ditched him amid his anti-Semitic rants.”
• “Legal experts told The Post that since West, 45, isn’t entitled to legal representation like a defendant in a criminal case would be, firms will instead weigh whether agreeing to rep the controversial rapper could damage their reputation and alienate other clients.”
• “It’s a balancing act between taking on celebrity clients who could attract attention and new business, and saying no to those who could scare away prospective or existing clients, legal experts agreed.”
• “Lawyer Rachel Fiset added that a firm might not want to align themselves with the comments that West made because it could drive away Jewish people they represent. ‘An attorney needs to do a financial analysis of who they represent,” Fiset said. “They may lose clients as a result of representing Kanye.'”
• “West had been represented most recently in his divorce by elite divorce attorneys Bernard Clair and Bob Cohen at the prestigious New York Cohen Clair Lans Griefer Thorpe & Rottenstreich LLP — but the firm parted ways with him amid the recent controversy.”
• “And Camille Vasquez – who gained recognition after leading Johnny Depp to a victory in his defamation case against ex-wife Amber Heard – also parted ways with West just a week after getting hired due to his anti-Semitic remarks.”
• “‘He is entitled to be represented but that is dependent upon his ability to pay for an attorney and an attorney’s agreement to represent him,’ former California judge and current criminal defense attorney Halim Dhanidina told The Post.”

“Fifth Biglaw Firm Says Goodbye To Kanye West” —

• “Now Biglaw firm Greenberg Traurig, which currently represents Ye in at least two active litigations, is backing away from the rapper. As reported by Law.com, the firm issued a statement that Ye’s comments are antithetical to the firm’s core values, and are in the process of withdrawing from the representations.”
• “Previously the firm indicated it was ‘taking steps in response to the reported remarks in accordance with ethical obligations and court rules.’ (Updated statement from the firm confirms they will not take future matters from Ye.)”
• “Four other Biglaw firms — as well as family law firm Cohen Clair Lans Greifer Thorpe & Rottenstreich that represented Ye in his divorce battle with Kim Kardashian — have also recently parted ways with the star. First Brown Rudnick decided they were done with Ye when he refused to back off of his antisemitic comments. Cadwalader — which represented the rapper in his separation from Gap — also dropped Kanye. And Pryor Cashman ended its longterm engagement with Ye. Then Quinn Emanuel dumped the rapper.”

“You’re running conflicts checks on your law firm’s marketing content before publishing it, right?” —

• “Are you and your law firm running conflicts checks on your and your colleagues’ thought-leadership marketing content? Yes, really, I am talking about running conflicts checks on your and your colleagues’ blog posts, bylined articles, and client alerts before they’re published.”
• “If you are not running conflicts checks on this marketing content, you and your law firm run the risk of that content coming back to bite both of you in the rear in two distinct ways.”
• “Positional conflicts. Admittedly, it is highly unlikely that a piece of thought-leadership marketing content will create a positional conflict under a jurisdiction’s rules of professional conduct. But that doesn’t mean your opposing counsel or their client won’t make that argument to a court.”
• “A positional conflict arises if there is a significant risk that a lawyer’s action on behalf of one client will materially limit the lawyer’s (or their law firm’s) effectiveness in representing another client in a different case.”
• “A classic example of this is when Lawyer A makes a legal argument before an appellate court on behalf of Client A that is inconsistent with how Lawyer A’s colleague at their firm, Lawyer B, is arguing for another firm client, Client B, in a separate matter at a trial court that is bound by that appellate court’s decisions.”
• “If a law firm does not perform conflicts checks on its thought-leadership marketing content, Lawyer C could write a blog post or client alert advocating for Position X without realizing that their colleague Lawyer D is currently arguing the exact opposite of Position X on behalf of Client D before a trial court in an active lawsuit.”
• “Rest assured that if Lawyer D’s opposing counsel or Client D’s adversary read Lawyer C’s blog post or client alert, they would consider asking the court or the official presiding over the proceeding to disqualify Lawyer D from representing Client D due to a purported conflict.”
• “While this could cause a headache for Lawyer D and Client D, and perhaps some drama between them, this situation is unlikely to be considered a true positional conflict.”
• “However, in a situation with the perfect set of facts, a court could hold that a piece of thought-leadership marketing content was ‘action on behalf of one client’ if the author of the content was publishing the content in order to influence the Court of Public Opinion to get a better legal outcome for the client.”
• “The second way a failure to run conflicts checks on your firm’s thought-leadership marketing content could come back to bite you and your firm in the rear is by creating content that is cited by your or your colleagues’ opposing counsel in support of their clients’ legal positions against your firm’s clients.”
• “This situation is not as severe as a positional conflict that runs afoul of your jurisdiction’s ethics rules. But this situation is both more likely to happen and more likely to impact your firm’s bottom line by potentially upsetting clients to the point that they fire your firm.”
• “By now it should be clear to you that if your law firm is of a certain size, it is worth conducting conflicts checks on the firm’s thought-leadership marketing content. But how?”
• “My recommendation is to create a pre-publication conflicts check system. This system will necessarily be different than a client conflicts check system because you will need to do more than reviewing your firm’s previous and current clients, adverse parties, etc.”
• [Read on for specific policy/process recommendations.]

Above the Law spotlights PR & Reputation Risk Meeting Streisand effect: “Jones Day Whines About Law Review Article… So Now We’re All Going To Go Read That Law Review Article” —

• “A law review article is like posting party invitations on Friendster in 2022. Alas, the Streisand Effect is a law review’s best friend, and thanks to a Jones Day partner’s three-page letter to the author, a lot of people are about to check out W. Bradley Wendel’s “Lawyer Shaming” from the Illinois Law Review.”
• “Professor Wendel of Cornell Law School, wrote the piece inspired by the efforts of the Lincoln Project to shame firms directly or indirectly involved in Trump’s challenges to the 2020 election, though the article as a whole delves into nagging questions of a lawyer’s professional responsibility when dealing in problematic representations.”
• “Despite being a timely and important topic, this article likely wasn’t getting much attention, but it caught the eye of Kevyn Orr at Jones Day! And he decided to send Professor Wendel a THREE-PAGE letter about it!”
• “…Jones Day, in fact, represented the Pennsylvania GOP committee in litigation aimed at DISENFRANCHISING Pennsylvania voters. See, they didn’t ‘allege voter fraud’ they simply argued that the courts should throw out the winning ballots as illegal from the start! Oh, Distinction? You forgot your difference.”
• “Orr can quibble that throwing out mail-in ballots from overwhelmingly urban areas still subject at the time to COVID restrictions doesn’t count an ‘attack on democracy,’ but (a) it totally does, and (b) doesn’t make Wendel’s article inaccurate for noting that people criticized Jones Day for this.”
• “Why drag all of this out into the open over a law review article that no one was going to read? We can’t answer that for Jones Day…”
• “Jones Day’s activity didn’t involve phony affidavits or allegations about Italian space lasers or whatever. Nor does anyone suggest the firm would ever sully itself with that kind of work. But it was engaged by Republicans in lawsuits intended to change the results as tabulated. Jones Day may not like being looped in with kooks like Rudy and Powell because its lawsuit attacking ballot rules was more ‘professional’ in tone.But even Best in Show gets fleas when lying down with the other dogs.”

“Atty’s In-House Work For Housing Co. DQs Firm In Mold Suit” —

• “The Georgia Court of Appeals has ruled that a Wakhisi-Douglas LLC senior attorney’s in-house experience with First Key Homes of Georgia LLC created a conflict of interest that disqualified the firm from continuing to represent a man suing First Key over mold in a rented home.”
• “Presiding Judge M. Yvette Miller said in an order on Monday that Wakhisi-Douglas attorney June James had handled legal work during her time with Key First that was substantially similar to the case she is now helping to pursue on behalf of client Kobree Robinson, and that the incident at the heart of Robinson’s suit had taken place while James was still employed by the housing provider. Chief Judge Brian M. Rickman and Judge Trea Pipkin agreed with Presiding Judge Miller.”
• “Robinson sued First Key and Cerberus SFR Holdings II LP in May 2021 alleging that he and his wife suffered side effects from renting a home that was contaminated with mold, and that the companies ignored complaints about the situation. The appellate court’s decision on Monday handed a win to First Key and Cerberus, which had asked the judges to reverse a trial court’s refusal to disqualify the Wakhisi-Douglas firm from handling the case.”
• “‘James worked with outside counsel to gather information regarding any communications with residents that filed lawsuits against the company,’ Presiding Judge Miller said. ‘She would also review the resident’s legal complaint and would speak to the property manager and outside counsel to prepare for litigation.'”

SRA: “Anti Money Laundering annual report 2021-22” —

• “We take our role as an AML supervisor very seriously, as this review of our work in 2021/22 demonstrates. As part of that, we significantly increased the resource we dedicate to preventing and detecting money laundering in the last year.”
• “These additional resources have allowed us to step up our supervision in this area to directly engage with more firms through 163 inspections and 109 desk-based reviews… We have also stepped up our work to make sure solicitors understand and comply with their obligations to uphold the financial sanctions regime. We issued guidance – with more to come in autumn, along with information on risks and red flags – and undertook a thematic review on what can be a tricky area to get to grips with.”
• “We also undertook an exercise to identify a sample of firms with exposure to the Russian market and to screen their client lists for ‘designated persons’ – that is those who are subject to financial sanctions. In the coming year, we will continue to work proactively to make sure we help firms we supervise to comply with sanctions legislation, stepping in to take action where they don’t.”
• “To those firms not doing enough to prevent money laundering, you need to take your obligations seriously and play your part. As we increase our inspection and desk-based review supervision now is the time to put your house in order.”
• “Solicitors and law firms are attractive to criminals because they process large amounts of money, are trusted, and can make the transfer of money or assets appear legitimate. Most law firms work hard to prevent and to spot money laundering and take necessary action, but some get involved unknowingly. A very small number may even knowingly cooperate or work with criminals to launder money.”
• “We record the reasons why a report has been made. In 2021/22 there were 252 money laundering-related reports with 393 reasons attached. Often, reports have more than one suspected breach that need investigating and these can change during the life of an investigation as we get more information.”
• “Understanding the source of funds to be used in a transaction is a fundamental part of the risk-based approach. If you are clear around the legitimacy of the source of funds, the risk of money laundering is greatly reduced. While we have seen a slight improvement, firms need to do more in this area.”
• “Flowing from FWRA, client/matter risk assessments prevent money laundering by making sure firms consider the risks posed by each, and whether firms can perform the correct level of CDD to mitigate those risks.”
• “During the reporting period we reviewed 1,325 files. Of these, 20% did not contain a client/matter risk assessment, as necessary under the regulations. Where firms failed to undertake client/matter risk assessments, they were referred for an investigation.”
• “In some cases, firms had a template matter risk assessment form, but this was not being completed correctly, or even used at all.”
• “Many of the forms we saw were very basic and tick box in nature, where fee earners only had to mark whether a file was high risk, medium risk, or low risk. Often, these forms did not feature any commentary or justification where the fee earner could input how they had arrived at the risk level.”
• “Similarly, many forms we looked at failed to set out high-risk factors, which fee earners need to consider when assessing the level of risk with the client or matter. These forms also failed to notify the fee earner when EDD was required. This is concerning, as matters subject to EDD are typically the highest risk.”
• “We also reviewed a number of risk assessment forms which assessed the wider risk to the business as a whole. For example, reputational risk and whether the client had the ability to pay fees, as opposed to the AML risk. These forms would not constitute a client or matter risk assessment as needed under the regulations.”
• “Some of the best examples we saw were where the matter risk assessment form set out factors which fee earners must consider when making an assessment of client or matter risk.”
• “We also saw some good examples where firms used different matter risk assessment templates, depending on the type of work being carried out. For example, whether the matter was transactional or non-transactional. These templates contained guidance for fee earners around the various risks that could be present.”
• “One firm adopted a client or matter risk assessment form that set out various risk factors which must be considered by fee earners. Each of these factors provided a risk weighting. Where a certain risk threshold was met the fee earners had to gain approval from the MLCO to proceed with the matter.”

The Yale Law Journal: “The Pitfalls and False Promises of Nonlawyer Ownership of Law Firms” —

• “Whether nonlawyers should have ownership roles in law firms has been and remains a hotly debated topic. The debate concerns potential reforms to Rule 5.4 of the American Bar Association’s Model Rules of Professional Conduct, which sets guidelines for maintaining the professional independence of lawyers, as well as the impact of those revisions on the legal profession.”
• “Advocates for such reform, such as Ralph Baxter,4 claim that reforming Rule 5.4 and similar restrictions on nonlawyer involvement in the practice of law is the only viable option for increasing access to justice and fostering innovation in the legal field.”
• “Although advocates for such reform argue that nonlawyers must be allowed ownership roles in law firms in order to foster innovation and increase access to legal services, many lawyers have raised significant concerns about the impact that nonlawyer ownership would have on the independence of lawyers.”
• “Lawyers have concerns about allowing nonlawyers—who have not sworn to uphold the ethical obligations that attorneys promise to uphold when becoming members of the bar—to have decision-making authority in the day-to-day practice of law.”
• “There is also no evidence that nonlawyer ownership actually improves access to justice for the needy. This Essay argues against rewriting Rule 5.4 to allow nonlawyer ownership of law firms. It concludes that nonlawyer ownership not only fails to solve the problems that advocates of reform promise it will address but in fact creates meaningful risks for the legal profession.”
• “An overriding concern relates to fee sharing, which lawyers worry will lead to less control over their practices, particularly when it comes to decisions about settling contested litigation. For example, nonlawyer owners of law firms, who are not bound by legal-ethics rules, may be incentivized to push for a settlement in which they have an interest in sharing fees rather than continuing litigation to obtain the best result for the client. Other concerns include advertising for legal services in a way that violates the Rules of Professional Conduct,55 the unauthorized practice of law,56 conflicts of interest arising from the lawyer’s connection with nonlawyers,57 and the preservation of client confidences through attorney-client privilege.”
• “Similarly, in Florida, a proposal to allow NLO and fee sharing with nonlawyers was unanimously opposed by the Florida Bar’s Board of Governors in 2021 and by many Florida lawyers who commented on the proposal. Members of the state’s Board of Governors expressed their substantial concerns over the proposal at its November 2021 meeting.87 These included ‘profound conflicts of interest… between lawyers and their ethical obligations and nonlawyers that the court can’t regulate who are entirely driven by profits.'”

“Will EY Law Change The Legal Delivery Paradigm?” —

• “EY’s leadership recently green lighted a major restructuring, ending months of heated speculation. The plan has two key prongs: (1) EY’s audit and advisory businesses will split; and (2) the advisory business will replace its partnership model with a publicly traded corporate structure.”
• “The restructuring presents a unique opportunity for EY Law to expand the scope and meaning of “legal services,” reinvent how they are delivered, broaden the range of legal careers for licensed attorneys and allied legal professionals, and extract greater value from the legal function by aligning and integrating it with business.”
• “Cornelius Grossmann, EY Global Law Leader, shared: ‘The transition away from the partnership model and the removal of audit independence restrictions are fundamental to our vision to create the world’s leading enterprise legal services provider.’ The opportunity to achieve this bold vision is real, but so too are a host of challenges. This article will examine both.”
• “Independence from audit restrictions will also reduce the substantial administrative burden on EY and, sometimes, its clients. The spin-off will also allow EY Law to develop relationships with audit clients. This will open up partnering arrangements that produce new products and services helpful to customers. For example, EY Law can soon engage with several leading technology companies it audits.”
• “EY Law’s structural reboot provides an opportunity to create a flatter, more nimble, customer-centric, data-backed, capitalized, collaborative, integrated, and merit-based organization than the partnership model it will replace. It will have access to institutional capital to fund long-term investments in technology, process improvement, new services, collaborative ventures, acquisition (including law firms where regulatory permitted), and talent.”
• “This contrasts with the partnership model where decision-making is slow and often driven by how close a partner is to retirement. Resistance to long-term investment, likewise, is linked to the absence of a residual economic interest in the business. This promotes stasis, a short-term horizon, and discourages creativity and innovation.”

“‘Plagiarism’ Common in Brief-Writing, but When Is It Too Much?” —

• “It often takes more than what people usually think of as plagiarism in a legal brief for a court to sanction an attorney.”
  “Some degree of “borrowing” in legal writing is tolerated, if not expected, in the context of litigation, where persuasiveness and efficiency are usually more important than originality.”
• “Though frowned upon, there is no uniform standard for determining when a lawyer who copies arguments from another lawyer violates professional obligations.”
• “Lawyers are more likely—but not guaranteed—to run into trouble when they copy-and-paste language written by another firm’s lawyers.”
• “A formal ethics opinion issued in 2018 by the Association of the Bar of the City of New York’s Committee on Professional and Judicial Ethics concluded that plagiarizing another lawyer’s brief isn’t per se professional misconduct.”
• “The committee noted that generally when courts have sanctioned or admonished attorneys for copying and pasting prior work, it’s because of some aggravating circumstance that independently implicates or compromises an explicit professional obligation.”
• “The US District Court for the Eastern District of Pennsylvania recently sanctioned a lawyer for the Borough of West Chester after she plagiarized much of opposing counsel’s legal arguments in briefing for a motion to preclude lay opinion testimony.”

“Federal Judge Disqualifies Baker McKenzie From Representing Russia’s VUZ Bank” —

• “Attorneys from Baker McKenzie have been disqualified from representing Russia’s VUZ Bank after a federal judge in Virginia determined a conflict of interest was present.”
• “The court granted both Deniz Bahceci’s and Alettin Bahceci’s motions to quash the subpoenas and to disqualify Baker McKenzie counsel from representing VUZ Bank due to a conflict of interest.”
• “Dillon said Baker McKenzie attorneys violated Virginia Rules of Professional Conduct when attorneys from the firm met with Kroll, an agent of Hakan Agro, concerning the company’s insolvency and possible liquidation in June 2021 while representing VUZ Bank in a similar matter.”
• “Dillon rejected the bank’s argument that the intervenors do not have standing, saying Deniz and Alettin Bahceci are ‘clearly implicated,’ with Deniz Bahceci representing the minor children and Alettin Bahceci being the potential target of criminal proceedings in Dubai. Attorneys Brian Lee Whisler, Jacob Kaplan and Robert Edward Duffy III of Baker McKenzie previously represented VUZ Bank. A request for comment from the attorneys went unanswered.”
• “Dillon noted that a nearly identical scenario occurred in the U.S. District Court for the Northern District of Georgia when VUZ Bank sought information from Georgia resident Ashley Anderson Bahceci, the ex-wife of the now-deceased Hakan Bahceci, who founded Hakan Holdings.”
• “The Georgia court determined that Baker McKenzie should be disqualified from representing VUZ Bank pursuant to Georgia Rule of Professional Conduct 1.18(c), which says ‘that [a] lawyer [who has learned information from a prospective client] shall not represent a client with interests materially adverse to those of a prospective client in the same or a substantially related matter if the lawyer received information from the prospective client that could be significantly harmful to that person in the matter, except [if both the prospective client and current client have given informed consent in writing].'”
• “Just like in the Georgia case, Baker McKenzie failed to obtain informed consent in writing regarding the conflict of interest for the Virginia case, Dillon said.”
• “All Baker McKenzie attorneys are disqualified due to a Virginia rule not allowing representation from any lawyer at a firm in which a disqualified lawyer is ‘associated,’ the filing said.”

“Camden Diocese Insurer Wants Cole Schotz Out Over Conflict” —

• “One of the Diocese of Camden’s insurers has called foul on the diocese’s plan to hire Cole Schotz PC as special counsel in its bankruptcy case on the grounds that the firm is already representing one of the sex-abuse claimants against the diocese.”‘
• “The diocese’s main attorney, Richard Trenk, filed on Oct. 21 to bring on Cole Schotz as special counsel to defend him during a court-directed deposition. Century called the move ‘improper,’ as Cole Schotz is also the counsel of record for one of the claimants, confidential claimant No. 532.”
• “‘While the Debtor goes on to say that this representation is solely in connection with a motion to allow a late-filed proof of claim, it offers no evidence to confirm that is the case but even if it did, it would not matter,’ Century wrote in its objection.”
• “That claimant’s motion is still pending, and representing both the claimant and the diocese is a conflict of interest under New Jersey’s Rules of Professional Conduct, Century wrote.”
• “Warren Usatine, the co-managing shareholder of Cole Schotz who Trenk proposed to hire, acknowledged the connection with confidential claimant No. 532 in working on the late-filed proof of claim, but maintained in his application to represent Trenk that it wasn’t a conflict of interest. ‘Insofar as I have been able to ascertain after diligent inquiry, neither I, nor Cole Schotz, nor any member, counsel or associate thereof have any connection with, or have an adverse interest to, the parties on the Entity List except as set forth herein,’ he wrote.”
• “Century was not convinced. ‘To be clear, this is not a mere technical conflict,” it wrote. “The information Mr. Trenk may discuss with counsel should not be disclosed to counsel for claimants. And, by allowing this concurrent representation, such disclosure is possible.'”