California Bar Journal
OFFICIAL PUBLICATION OF THE STATE BAR OF CALIFORNIA - SEPTEMBER 1999
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ETHICS BYTE

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Time to read between 'of counsel' lines
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A new Supreme Court decision on the issue of attorney disqualification in "of counsel" relationships, People v. SpeeDee Oil, July 17, 1999, No. S058639, upholds traditional theories regarding the concept. "Of counsel" is a type of "close, personal continuous and regular" relationship between a lawyer and a firm. It can be part time, a potential partner on probationary status, or any other sort of affiliate relationship.

Diane KarpmanThe court justifiably determined that lawyers who meet at water coolers, coffee stations, and down the hall need to kibitz. Since all are bound by the same duty of confidences (Business & Professions Code 6068(e)), the client's interests are served when ideas and strategies are brainstormed or bounced off one another. In this particular case, the "of counsel" attorney was also physically located within the firm's office and shared a telephone receptionist.

The firm and the "of counsel" attorney were simultaneously approached by opposing prospective clients SpeeDee Oil and Mobil, almost on the same day. During the initial discussions, which were held to be substantive as opposed to mere "initial or peripheral contacts," confidential information was transmitted to both lawyers by the prospective clients. In essence, the giant amoeba termed "the firm" simultaneously represented litigation adversaries, which is per se prohibited.

Remember that "even the briefest conversation" can result in "the disclosure of confidences." California has traditionally maintained that this can occur during simple interview sessions with prospective clients, leading to the creation of dual fiduciary duties of loyalty and confidentiality. Retention is not necessary. SpeeDee Oil maintains that this is particularly true if the information is communicated between lawyers.

But in Supreme Court cases, sometimes what is written between the lines is provocative. The court seems to imply that the use of "ethical screens," which in California is generally restricted to former government employees, could rebut a presumption of shared confidences. "The record provides no basis for considering whether an ethical screen, or other means of protecting Mobil's confidences, could serve the same prophylactic purpose as disqualification." SpeeDee Oil at p. 23.

This cryptic nod should cause all lawyers maintaining ethical screens to sigh in relief, since it represents a hint that screens might defeat those pesky disqualification motions.

Interestingly, in two footnotes, the court refers to "poisoning the well," i.e., contacting several attorneys in a specialized area, conveying just enough information to justify their disqualification in future litigation, thereby depriving the opposition of competent representation. The court implies that this and other "tactical abuses," such as delay in bringing the motion, can be considered in determining disqualification. The court states that in SpeeDee Oil, the client had a genuine interest in retaining the lawyer, and that in the Los Angeles area, there are so many competent lawyers that such a practice would not have been successful.

Diane Karpman specializes in lawyer law. She can be reached at 310/887-3900 or karpethics@aol.com.