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Ethics update

Bing Crosby and the attorney-client privilege

By Jonathan Bishop

This section highlights recent developments in attorney professional responsibility, including new cases, advisory ethics opinions, pending legislation and proposed rule amendments.


New York State Bar Ass'n v. F.T.C., (D.D.C., Aug. 11, 2003) 276 F.Supp.2d 110.

In denying the Federal Trade Commission's 12(b)(6) motion to dismiss, a Washington D.C. federal district court held lawyers and law firms are not "financial institutions" subject to the consumer privacy notice requirements of The Federal Financial Modernization Act, otherwise known as the Gramm-Leach-Bliley Act (GLBA), which was enacted in 1999. The FTC argued that all financial institutions under FTC jurisdiction, including law firms, must comply with Title V of the GLBA [15 U.S.C. §§6801-6809].

However, the court disagreed with the FTC and found that the language of the statute's privacy provisions and the scope of the congressional intent made it clear that attorneys do not fall within the purpose of the GLBA. The decision supports the claim that the GLBA should not be interpreted to impose a requirement that current and former clients receive notice from their lawyers explaining policies and practices on disclosure of non-public personal information.

Furia v. Helm, (Aug. 29, 2003) 111 Cal.App.4th 945, 4 Cal.Rptr.3d 357.

In a legal malpractice action, the court affirmed the defendant's general demurrer based on plaintiff's failure to allege recoverable damages. However, in its decision the court cautioned that an attorney who agrees to act as neutral mediator assumes a duty to perform as a mediator with the skill and prudence ordinarily to be expected of a person performing that role.

The court referred to Rule of Professional Conduct 3-310(C) and reasoned that an attorney accepting the role of mediator has the same duty to disclose potential conflicts that an attorney has when accepting representation of clients. The opinion suggests that even in the absence of an attorney-client relationship, before an attorney agrees to serve as a mediator, there should be complete disclosure of all facts and circumstances, which, in the attorney's judgment, may influence the party's selection of a mediator. Failure to make such disclosure may result in civil liability.

HLC Properties Ltd. v. Superior Court, (Sept. 29, 2003) 112 Cal.App.4th 305, 4 Cal.Rptr.3d 898.

A limited liability corporation, HCL, acquired the right to exploit Bing Crosby's entertainment interests and attempted to invoke the attorney-client privilege against discovery of certain pre-trial documents. In granting HLC's petition for a writ of mandate, the court rejected the defendant's argument that after Crosby's death HCL could not invoke the attorney-client privilege because there was no holder of the attorney-client privilege given the winding-up of his estate and the discharge of his personal representative.

The court found that in the facts presented, where HCL continued to operate Crosby's business, maintain offices and employ staff, the attorney-client privilege also continued and was not lost due to the liquidation of the predecessor entity owned by Crosby. The court recognized HLC as the holder of the attorney-client privilege.

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