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Don't Burn Bridges: How Legal Employers and Lawyers Can Separate Without Breaching Ethical Obligations to Clients and Each Other

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Don't Burn Bridges: How Legal Employers and Lawyers Can Separate Without Breaching Ethical Obligations to Clients and Each Other

The times when people joined firms hoping to become partner and remain until retirement are long past. It is common for lawyers to have more than a dozen positions during their career with some changing jobs more frequently than that. With the recent demand for talent, some people are changing jobs in less than a year. These moves raise issues as to obligations to clients and the client’s rights to select counsel. Lawyers and firms also need to evaluate conflict issues associated with these changes. In addition, departing lawyers and their firms may be bound by partnership agreements that address transition issues. Often neglected by all concerned is staying on good terms, leaving without regard to the other side can have longstanding effect on the reputation of lawyers and firms, and in the worst case, lead to litigation.

Presenters

Francine Griesing
Founder & Managing Member
Griesing Law, LLC

Transcript

- [Francine] Hello everyone, I'm Francine Griesing of Griesing Law. Thank you so much for joining me for don't burn bridges, how to change jobs without breaching obligations to clients and others. I wanna chat with you about why this is such an important issue today. When I first started practicing while I literally four decades ago, people often assumed that when they started a job, that would be their legal job for their life. People assumed for the most part if they went into a firm that they hopefully would be elevated to partner, and that's where they'd spend their career. Now people change jobs much more often, frequently, even more frequently than once a year. And now there's such a high demand for lawyers. That's becoming a big issue. So why do we wanna talk about this? Because people often don't realize the ethical obligations that they face when they leave a firm or someone leaves their firm or someone joins their firm. So we're gonna talk about what those obligations are, both to clients and to our colleagues. We're also gonna learn how you can best transition clients if you move from one firm to another firm and what the firm you're leaving, and the firm you're going to needs to do, to do this the right way. There's also in addition to the ethical rules that we all face in making these transitions, the contractual obligations and the fiduciary duties, because if partners are subject to a partnership agreement, or if you are a lawyer who signed a long term employment agreement, you have obligations that are on top of your ethical obligations. Also one, we transition from jobs. We're not always going from one firm to another. Sometimes we're moving from private practice to go into a client, to go in house at another company. So we need to talk about whether there are restrictions on what you can and cannot do in those circumstances. And then there are also people who moved in and out of government jobs or neutral jobs, such as becoming a judge or serving as a law clerk, being an arbitrator. These all have unique ethical issues related to switching. And why should you care about it? Well, the first reason is that, again, as I said, at the outset, we don't usually pick a job for life. Very few people do that anymore. And certainly lawyers. So it's not common for a lawyer to pick a career, move into a firm and retire 40 or 50 years later from the same place. People are moving. Not only are people moving laterally from firm to firm, but groups of people are moving. Practice groups are changing. And in addition, firms are merging or firms are splitting into different parts. Different practice groups might decide to have separate firms. All of these create a lot of ethical contractual issues and fiduciary duty issues. And right now, at least as I'm recording, I've seen a big demand for junior lawyers. Associates are really hot. They're getting lured from firms to go to other firms, offered lots of money, flexibility, and the like, and it's enticing and people are changing more than they might have years ago, or even a few years ago when people thought maybe they needed the stability of staying in one place. The other thing that affects people moving from firm to firm is that what we want as a lifestyle matter, I think has changed as well over time. And if anything, COVID has made that a bigger issue. People want the ability to work, where they think they can work most conveniently and do their best work. They want flexibility. They wanna work from home or a hybrid arrangement. So as people are offering different options, people are also moving to take advantage of those options. So with all this going on, we also think, have to think about whether conflicts are created when people make these moves. We need to think about the obligations of government lawyers and judges in terms of political issues or changes in administration that may force people to leave or cause them to want to leave. The other thing that makes this really important is that there's so much more attention on our profession. And as a result of that, this perhaps more scrutiny and criticism, but also as lawyers, we have more choices because we know more about what those choices are. But the one thing that I think is a common theme, whether you are moving from one firm to another, in and out of government, in and out of corporate jobs or moving from being a judicial officer or an arbitrator into a different type of practice is that if you burn your bridges and you leave on bad terms, it can have a long term impact on your reputation and on your career. So it's really important that we understand what we should do and that we do it well. So thinking about those issues, let's talk about the rules that you have to follow and responsibilities that are important to us, both for individual lawyers and for legal employers, such as law firms, corporate departments, government, and the like. For me, when I'm thinking about this, I always start with the rules of professional conduct. In this program I'm gonna focus on the ABA model rules. And the reason for that is that they are the template that most jurisdictions rely on. And although each jurisdiction has its own discretion to change that language, it's a good model, especially since I'm talking to people from across the country. But you should look at the specific rules in the jurisdictions in which you are licensed if you are making a move and not merely rely on the model rules, which may not be identical to those that apply to you. But it's important to note that if you don't comply with the applicable rules, there is always the risk of both malpractice claims by clients, but contract claims from your colleagues. And most importantly, in my view, disciplinary action and potential sanctions that flow from that, that we all wanna avoid. When you look at your contracts as well, if you are a partner at a firm or otherwise subject to a contract, whether it's the corporate employer or a firm, you will likely see the terms that affect your leaving your employment. And they're very important. But in my view, not nearly as important as your contracts with clients. What your engagement letters say about terminating the representation, withdrawing from the representation, moving from firm to firm and the like, which I think is also particularly important when you're talking about contingency cases and firms may be having disputes over who gets, what share of any contingency fee down the road. Many jurisdictions also have codes of civility, which govern how we're supposed to treat one another. Generally speaking, they're not of the same weight or power as the disciplinary rules and may not be enforced in quite the same way. They're often aspirational, but conduct that violates the codes of civility is often also conduct that violates the code of professional responsibility. But this issue of civility is also important. Again, coming to not burning your bridges. It's never a good thing when people part company on bad terms, and that frequently becomes the case when partners leave with significant books of business firms split, practice groups leave, and the like. We're going to talk about how to avoid these problems from an ethical point of view, a civility point of view, and a contractual point of view, as well as breaches of fiduciary duty. If you happen to be representing clients in litigation or in a forum, such as that, you also are facing the rules regarding withdrawing from representation. If you are leaving a firm and going to another firm or another job where you're no longer going to continue to represent the client in that proceeding. Further the contracts and changes specific to government in house jobs, nonprofit employers, and the like are very particular as are the rules. And you need to make sure that you follow those additional obligations, if you're making that type of move. I'm not gonna go through right now in detail, all of the specifics of the rules that can be implicated. I'm just going to flag for you that there are more than a dozen rules under the ABA model rules that are likely implicated when someone changes jobs and some rules apply only to some of you, depending on the kind of jobs you're leaving. And for others, it may apply to many more. Let's turn now to what the ABA model rules say specifically that you need to think about. First of all, if you're familiar with the ABA model rules, and I hope you're familiar at least with the rules in your own jurisdiction, they begin with the preamble, which goes over the scope of the rules generally, and is kind of an overview of our relationship as lawyers with the public, our clients, the profession, and generally speaking, maintaining justice and the pursuit of justice and treating people fairly and honestly. I could probably identify many more aspects of the preamble that apply when you're changing jobs, but I have flagged a few that particularly jump out at me and the first is kind of obvious but important. Because we're the legal profession, we are representing our clients, we're representing the legal system, the courts, et cetera. And we are perceived to have a higher responsibility than the average person to assure that things are done justly. We also have very specific obligations to clients that relate to make making sure that we're competent, that we have the expertise we need to handle matters. That we're prompt. That we respond to clients at others quickly and without undue delay, and that we're diligent. We don't procrastinate, which unfortunately, everyone understands sometimes you're tempted to do. One of the ways in which this is really important is that you wanna make sure that you communicate with clients frequently enough and specifically enough regarding your representation of them. And that comes into play when there is going to be a change. There are quite a lot of issues about when you tell clients, what you tell clients, who tells the client, how you tell them, what can be included in trying to persuade a client to follow you or not leave your firm. These are pretty significant issues that come up in greater detail in specific rules, but are again flagged in the preamble. We also wanna make sure that we are always acting in the way both personally and professionally and in our own business, that's considered just, and at a high level. So it may be in your best business interest to change jobs or good for your family if you switch, but you can't ignore how that impacts your clients in particular. And so I guess the key point to me from the rules from any set of rules, regardless of jurisdiction, is that the reason we have the ethical rules is when we have difficult decisions to make. And specifically when you're changing jobs, that is a circumstance in which there are a lot of competing principles, competing things you're gonna be concerned about and that you want to attend to. Let's focus now on exactly how does this play out in the real world? What does it mean for you if you are thinking of making a change? You've just made a change or people you're working with or leaving you, what do you do? How do you deal with it? So I thought it would be most helpful it is for me to think of like real life situations. And so I'm posing one here that I think many of us can relate to. I can say from my own practice experience, I've been someone who's left firms. I've been someone who has experienced practice groups leaving firms. And I've also been someone who's had people join my firms. So I have seen it and experienced it from all perspectives. And there are ethical issues that implicate everyone in these different capacities. So in our case study assume that you are an attorney who is a partner in a firm, and that you are also the practice group chair of your practice group, which I have identified as the intellectual property practice group. And in your group, you have two other partners and your group also has five associates. And you're concerning moving from the firm you're into another firm. So practical matter, I'm not sure it matters. What the reason... Do you feel that the rates are too high or too low, where you are, or the support from the rest of the team, isn't what you need? Or you can make more money? That's often a reason people leave. You want a greater geographic reach for your firm. Whatever it may be. You're thinking of leaving. And you wanna take your group with you, and you also want to persuade the clients you're currently serving in your group to follow you and your group from the first firm to the second firm. So what happens? What does everyone have to think about when this happens? You have to think about what information about your client you can share with the perspective of new firm, what you can and cannot do if you're going to try to induce others to come with you. What do you have to do before you actually accept or connection with accepting an offer to move? And what do you have to do with your existing firm, if anything, and with your new potential firm, before you actually reach out to your clients to inform them, you're making the move and ask them if they'd like to follow you? As well as the lawyer, who's leaving the receiving firm as I'll call, it has to think about a lot of issues as well, which we're going to discuss. And certainly once the first firm is informed that the attorney partner is leaving with, or without some of the other people and facing the potential loss of clients, that firm also has a number of ethical business and business and contractual issues to consider. Whatever you're thinking about in these situations there is no question, the client always comes first. That has to be the premier consideration for everyone involved in this move. The partner who's considering it. The other teammates who might follow with him or her, the firm you that's being departed from and the what I'll call the receiving firm. Everybody has issues that affect them, but the client's protection must be the most important thing with protecting client's interest during the transition, keeping the clients informed and giving them the information they need to make an informed decision as to whether to stay with the original firm, follow the group or select different council altogether. Those are all possibilities. And in connection with these transitions, everyone who I've identified needs to consider the various issues under the rules of professional conduct. Partners in particular, but anyone subject to an employment agreement needs to look at that agreement as well. 'Cause sometimes a partnership agreement will impose additional obligations with respect to departing partners that may go above and beyond or be complimentary to the ethical obligations. And hopefully they don't defy the ethical obligations because if they do the premier obligation is under the ethical rules. When you're thinking about the moves as well, all the parties involved need to look at the engagement letters to determine what happens to fees that might be held on account on retainer in IOLTA or trust account. What happens to amounts that are maybe due to the first firm, what happens on contingency and flat fee arrangements? These are all things that should be addressed in the engagement letters and these letters ideally of course, were accepted and signed by clients. Further if you're happening to be handling litigation type matters, where you're in a forum, the forum will have additional rules that you have to follow with regard to withdrawing, substituting counsel, giving notice to your client and to the court, et cetera. And you need to follow those strictly as well. There's nothing that you should do without looking at all of these items before you begin to pursue moving from one job to another. And I can't emphasize that enough because there are things that come up so early in the process that if you don't deal with the rules right up front, you can find yourself in a bad situation. Let's assume again, as I was saying that a partner at firm A, IP practice group chair wishes to move from firm A to firm B, before that lawyer is going to make the move there's inevitably going to be negotiations with the second firm is gonna be a need to share information because you can't move and take matters with you that might pose a conflict assuming clients want to go with you. So frequently in this process, the two sides the attorney seeking to move, and the firm that's recruiting will enter into a confidentiality agreement. Non-disclosure agreement of some sort that makes very clear that they're going to exchange certain information for conflict checking purposes. That it's going to be limited, that it's going to be kept confidential. And that in addition, it's not going to reveal any more information that is absolutely necessary for the purpose of assessing whether a conflict exists. That's a really important thing to do because as we all know, one of our paramount obligations to clients is confidentiality, which goes beyond attorney client privilege, which I'm not gonna discuss right now. But attorney client privilege is an evidentiary rule that occurs in the context, usually of a dispute and prevents compelled disclosure of confidential information conveyed by a client to the lawyer for purposes of obtaining legal advice. Confidentiality is broader because it involves in any information that you learn from your client in the course of representation, that's confidential. And so the duty under the ethical rules is not identical to attorney client privilege. And it's the confidentiality duty that we're focusing on in this situation, you can't share information about the representation of your client, confidential information, unless the client is informed . Consent or there's a legal compulsion to do so. Well, you can't, and shouldn't be going to your clients every time you're considering making a move before you've even determined you can or going to asking them usually whether you can share this information with a potential new employer among other things, it could be a breach of your agreements to your firm, both fiduciary duty wise and contract wise. So that's not the way to go. The rules recognize that people need to move. And so the way the rules deal with this is through model rule 1.6 B. When you need to reasonably provide information, one of the situations recognized is when you need to move. So as point, part seven says the 0.7, you can share information to detect and resolve conflicts related to changing your employment or in changes in the composition of your firm as long as you don't, as you can see, jeopardize attorney, client privilege or prejudice the client. And of course you wanna make sure you don't inadvertently provide information. So one of the things you also wanna make sure you do is exchange enough information about the different parties, witnesses, and stakeholders who may in fact be implicated by your move. Here's some of the comments that are in the model rule 1.6, dealing specifically with changing jobs. I wanna be clear that you wanna only do this when you're in a real conversation. You're not in a tentative sort of conversation with multiple players because the conversation about moving needs to be substantive and real. Also, you wanna give enough information for a conflict check, but not disclose information that could jeopardize the client. Let me give you an example of what that might be. If you are representing a client in a potential criminal matter where the client has not been indicted, but there is an investigation underway. It may very well be that that client would not consider it appropriate for you to reveal to the potential new firm that that client might be facing a potential criminal matter. Another example that may be, I think even more obvious is what, if you are a matrimonial lawyer, a family lawyer, and a spouse approaches you for advice about a potential divorce, but has not informed the other spouse of this happening? So you wouldn't want to reveal to another firm that someone has come to you and is exploring a potential divorce. You don't know if the other firm may be talking to the spouse and you may be giving them information that would be prejudicial to your client. There's many other situations like that, but I just wanted to flag that it's not appropriate to give information that could jeopardize your client's interest. And sometimes that can be a very tricky line to walk. So assuming that you have decided to leave, you have informed your existing firm and complied for the moment with the, whatever the rules are. One of the big things that happens when you are considering moving is firms really fight. I find unfortunately about who's going to keep the clients, who is going to continue to represent clients that were represented by the first firm and now may wanna move to the second firm or find completely new council. First of all, most partnership agreements have very specific requirements about this, but the ideal way to handle this is for the parties to make a joint communication to clients, the parties meaning the initial firm and the departing lawyer, a joint communication as reasonably soon as possible. So that clients have time to consider their options. Informing the client that such and such a lawyer or group are leaving. They're going from this firm to that firm, that the client has the right to decide which firm the client would like to use going forward. And it's, often the case that the two sides are, so bitter that that doesn't happen. If that doesn't happen the departing lawyer certainly still has the responsibility for sure as is the firm to make sure the information is provided to the clients in a clear way that under lines that the client can pick whatever lawyer the client wants without consequences. So there are several rules that deal with what you can say when you're trying to promote yourself, what you can publicize, what you can say to toot your own horn, so to speak. And obviously we all know that you can't say something that's also misleading. You can't make a material misrepresentation or amend a material fact. The other thing is that's really important, I think is the solicitation of clients under rule 7.3. And there are a lot of factors that go into that. But one of the things that's really important is to make sure that you provide the kind of direct communication that is consistent with what these rules require as they are adopted in your jurisdiction. They're pretty clear usually, but if you don't know what to do, you can always seek advice from ethics council, or you can seek advice from the appropriate bar authority because they will give advisory opinions in most instances, or may already have an opinion that deals with your situation. So I'm going to move on now with our hypothetical. Dealing with the group, wanting to leave from, from A to B. And at this point we can assume that the IP chair and most of his colleagues have decided to make the move. And we're gonna also assume that the invitation to move was made to the entire team. However, one of the intellectual property associates decides not to move and that person decides not to move because as a fairly senior associate, they believe that the departure of the group opens up a great opportunity. Their chance of becoming a partner increases tremendously. And apparently some of the clients at the first firm have been with the firm a long time are really clients for lots of other types of work, not just intellectual property work. In fact, intellectual property work, maybe the sort of the tail, not the dog, so to speak. And there seems to be work for the associates to continue to do once the group leaves. What are the issues that are created when that happens? I'm going to go into some more detail as we go into the next slides, but a few things jump to the top of mind when you think about this. Is the remaining associate competent to handle the matters and is that person competent to do so without supervision of other intellectual property lawyers and how can other supervisory management partner level people at the firm fulfill their responsibilities to assure that the associate is capable of doing the work and otherwise acting appropriately? We can also think in a situation like this, that some matters are going to be moved to firm B that's likely frequently the case, but in connection with the transition, the team that's moved is learning the system and getting up to speed and going through training and doing the things that that people do when they change jobs. And as a result, they're not quite as attentive to client matters as they are if they weren't going through transition. This implicates, the obligation of diligence under rule 1.3, which we'll also talk about further, and finally assume that the first firm is very unhappy to lose clients and is not really inclined to want to participate or cooperate in what's going on. There is, as I said, earlier, communication obligations, and there is a specific rule, 1.16 that deals with terminating representation and includes dealing with it when lawyers move from firm to firm. So let's talk about the lawyer client relationship that's implicated in these issues and generally when we make a move. First of all, you have the duty to only provide competent representation means, you know, the subject matter, you have the skills you need, you're thoroughly prepared and the like. Diligence very clear it is, do not procrastinate in my mind. To me, that is what's the critical thing related to not letting things fall through the cracks or be delayed when you are moving from one firm to another. And in addition, it's very important to keep clients apprised about the status and not let what's going on with you have an impact. So let's talk first about the associate who's staying behind. It is okay if that associate doesn't know everything about the IP problems that the clients have, it's not a lack of competence or an ethical breach. If it's something that the person can learn, if the person can get other support, either within the firm or outside the firm. I had a situation several years ago where actually the most knowledgeable IP lawyer on my team went to in-house to a client. And we still had a considerable roster of IP clients who could not follow this lawyer in-house but the other people working on the matter did not have the same level of expertise and experience as the person who left in that situation because intellectual property was not my wick I actually arranged for a sole practitioner who had stunning amount of expertise and qualifications to partner with us, with our clients' written consent, to oversee the matters and assure that our more junior lawyers who remained were properly supervised and able to do the, do the work. And ultimately we actually transitioned those clients to another firm that had a deeper bench to handle them long term. But that's something that you can do if you have support of senior lawyers and don't have, and the clients wanna remain in, you don't have the full level of expertise that you would like to have to handle the matters. Another issue as I've raised is when you move, sometimes things just don't get handled quite as quickly as they used to. I can't emphasize enough that it is our responsibility to control our workload, and we can't let our own personal situation cause us to delay how we respond to clients and handling their matters. And this was a big issue frequently during COVID 'cause people were so disrupted and often didn't get back to clients as quickly as they used to. And when that happens, clients become unnecessarily stressed and they also lose confidence in our abilities and in relying on us. So the other issue that's really important in dealing with moving clients from one firm to another, or for clients determining whether or not they wanna move from one firm to another is they need to have the right information. So we need to tell them as soon as we can, we need to make sure we are clear in writing about what their options are with respect to staying with one firm or moving to another, or perhaps even picking a third firm. These are all things that are really important to make sure that that happens. In addition, you wanna look at any partnership agreement, as I said, because for example, I have been aware of firms where the agreement says that if a partner is leaving the firm, the partner can contact clients until it gives the firm 24 hours to do so first. I've seen agreements where, say, which say, which I think is the ideal that individual partners who are leaving can't contact clients without having someone from the existing firm, participating in that communication to ensure that the information is fair and appropriate and not unbalanced. There's a variety of things you can do. But there are some agreements that tend to try to inhibit partners from giving clients prompt notice, and that is not permissible. The clients need to get prompt, notice with all the information they need. Another important issue in dealing with this is making sure clients can have what they need to make the right decision as to who they want to represent them going forward. It's important to do that. And I just want to make sure that everyone understands that you need to make sure that clients are not led to believe that they have to either stay with one firm or move to the other. I think that one's pretty straightforward. At least I hope so. Turning again to the associate who decides to stay behind. The rules on supervision are found in section five and there's also rules relating to non-lawyer assistance, which I'm not going to go into for purposes today. What is really important here is that the partners who remain at the firm, whether they're IP lawyers or not, they have responsibilities to make sure that all the lawyers are meeting their ethical responsibilities, which includes competence. So the firm needs to make sure that if the firm is retaining IP clients and a more junior lawyer non-partner is handling them that the lawyer is, has the right skillset and experience and ability to do so at the best level. Similarly, it's not okay for the subordinate lawyer, the associate here to take on work because someone directs them to do so. If that lawyer doesn't feel the lawyer is capable of doing so, the subordinate lawyer must also make sure to alert the partners. If that lawyer is unable to handle the matter without additional help or expertise. So let's talk about money. Unfortunately, even though we don't like to think about it, yes, law is a profession, but it's also a business. And the way we get paid usually is fees. They may be hourly. They may be flat fee. They may be contingent. They may be some other basis or combination of those. So let's assume here that when this group is leaving from firm A to firm B that a particular client paid the initial firm, an upfront retainer for an entire transaction to be completed, involving their intellectual property. Maybe it's a licensing agreement or something else, but that, that project is not complete when the group handling it moves from firm A to firm B and the client wants the, group that's been handling it to continue to handle a matter until it's concluded, even though they're moving to a new firm. Another situation that comes up with fees is a client may owe the first firm fees when the client moves to the second firm and the firm may not want to release the client's file until it's paid in full. That is a particularly common situation and a tricky one that I don't like to see firms get into. Another issue that comes up when people move from firm to firm is if lawyers spend time on transitioning from firm to firm, should the clients pay for that? And which firm is entitled to that money ? Let's delve into these. The rule that's most important when we're talking about this is model rule 1.5, the rule on fees. The most important thing we need to think about when we're thinking about the rule on fees is that lawyers cannot charge fees that are an unreasonable period. And there is a whole array of factors that go into evaluating whether a fee is reasonable or not. In addition, not every jurisdiction requires fee agreements or engagement letter to be in writing unless the matter is contingent. However, in my view, all engagement letters and fee agreements should be in writing. So there is no dispute or misunderstanding later because if there is a dispute and there's not a writing, it is likely that that dispute will be perceived in favor of the client, not the lawyer for a variety of obvious reasons. I hope, but clearly we are the ones responsible here. We're the ones who are bound by these ethical rules. So you wanna try to have your agreements on fees in writing. Also, if you are moving from one firm to another, the rules regarding dividing fees, between different lawyers in different firms are also implicated. And firms also may find that depending on what jurisdiction they're in, or if there are many jurisdictions, it could be a variety of situations you need to know specifically, what are the rules in your jurisdiction about firms sharing fees. But the most common thing that is perceived to be permissible and reasonable is where lawyers are paid based on their proportionate contribution to the matter. And so that's a really important thing to think about how much time does each one spend on this. With regard to the issues we're talking about one of the things that I think is particularly troubling is how much firms fight about holding client files and sharing contingent fees. I'm aware of multiple cases where firms dispute what each side should get in a contingency situation and are often in extensive litigation over a portioning fees in that situation. Similarly, it comes up as well when an initial firm received a flat fee and then the lawyers leave and the matter has to be concluded at the second firm. The clearer, the engagement letter is, and the clearer, the partnership agreement or agreement between the lawyer and the firm even if they're not a partner as to how fees will be dealt with upon termination, whether the termination is the choice of the lawyer leaving or the firm's decision, the more you have in writing, the clearer it is the fewer disputes you're going to have. So I urge you to take that into account and rethink maybe what you're doing in these situations. Another rule that's really important is how we deal with client property, including money. I am not going to address the nuances of trust accounts, IOLTA accounts, because in my view, they are so complex and could themselves easily be treated in a full course, which is beyond the scope of everything I can cover today. I just want to point out couple of very important things. We all must hold client properties separate from our own property, which means retainers paid in advance that are not clearly specified to be applied entirely upon receipt must be maintained in a separate escrow trust by IOLTA type account, not commingled with the law law firm's own funds or own account and money should only be applied as it is earned. The other issue that comes up with client property is client files. Unfortunately, I'm aware of many disputes that have arisen between departing lawyers and clients who follow them on the one hand and the firm that's been left behind. And I'm aware of many situations where the firm that's been left behind has refused to turn over the client files to the departing lawyer or the departing lawyer's new firm or the client until the fees have been paid. Regardless of what the explicit rules are in your jurisdiction, my recommendation defer in this situation, however, distasteful it may be to them to forgo the files when money is owed. In my view, the files should be turned over promptly, and there's an overriding ethical and professional reason. I say that because you do not want a client's matter to in any way be jeopardized or the ability of the lawyer to continue to handle the matter at a new firm to be impeded because the client and the lawyer do not have the files. To me, that is the overriding consideration with regard to transfer of client files. I believe that they should be transferred promptly. There may be others who might take a different approach, but for the reasons I stated, I think that is uniformly the safest approach to protect the firm from malpractice, breach of fiduciary duty and claims as well as ethical issues. Another thing that we can't ignore at all are all of the issues about conflicts when people change firms. As I said, at the outset, you need to do an appropriate confidentiality, non-disclosure agreement with a prospective firm providing the necessary, but limited information to do an appropriate conflicts check without jeopardizing client interest. But that is not the end of the conflict analysis. Let's assume that the partner and his group or her group has moved from the first firm to the second firm. The partner represented the client while at the initial firm, the client, the partner now joins the second firm. In this situation, the client did not follow the partner to the new firm. Perhaps the client was a longstanding client of someone else at the firm. Perhaps the IP work was a very small amount of the work the firm was doing. It doesn't actually matter why, but the particular client in our hypothetical has chosen to remain with the first firm . Shortly after the partner and the group join the second firm, the second firm takes on a case against the client who's at firm A. What we need to look at is, this a conflict for the firm, the new firm, or for the partner? And the answer to that is it depends. So it depends on a variety of issues. It depends on first of all, whether it's considered a conflict of interest among current clients, a conflict of interest with respect to certain types of current clients, such as organizations, whether it's relates to our former clients. And once you determine whether there's a conflict with respect to the partner who made the move, you then have to evaluate, if in fact there is such a conflict. Does that conflict get imputed to the firm as a whole? And how do you avoid that? So I don't think that the situation I'm talking about really implicates current clients, because what we're talking about is whether the partner who moved and their new firm are barred from having the firm take on a case against a client that the partner represented at the former firm. So to me, the rule that you start with here would be rule 1.9 and rule 1.9 states that a lawyer who formally represented a client in a matter shall not thereafter represent another person in the same or substantially related matter, unless certain requirements are met, which include that the it's not materially adverse to the former client and the former client gives informed consent in writing. So when you think about that, if the partner did represented the former client, and the matter is substantially related, you have to now go to the next step. So let's assume that client represented, the partner represented the client in the first firm. It had to do with a particular kind of IP issue. And now there's a dispute over whether that IP ownership is valid. So it is substantially related. So, and I would say in that situation, the client former client's interests are materially adverse to the new client. So you would need the former client to give informed consent in writing. One thing you'd need to be sure about is even if that former client did give informed consent in writing, you have to make sure that neither the lawyer, the partner who left or the new firm is using any information that the, for the partner learned when he was working with that client, through that representation, and you can't use as confidential or information that would hurt the former client. If however, the matter is not related to the matter that was handled at the former firm, or if there's not material adversity, client consent is not needed. However, for a matter of relationships, the partner and the new firm may determine that they feel the need to inform the former client and to confirm that they don't perceive it to be substantially related or material adverse and, possibly get the client to still give consent or agree to that. And of course, in doing that, you would want to urge the client to get independent advice on that so that the client is giving informed consent and not relying solely on the partner or the new firm. Another thing that really comes up in these situations that it happens very often is that a lawyer cannot handle a matter that for someone that in the same we're substantially related matter in a firm in which the lawyer formally was associated with had previously represented the client. Similar principals apply in terms of material adversity and in terms of getting client consent, informed client consent confirmed in writing. And whenever I asked for client for informed consent, I clearly specify that they should seek advice of other counsel. All right. The comments to rule 1.9, I think are very helpful. They recognize that lawyers move and that there's a tension between wanting lawyers to be able to move and wanting to protect client interests in these situations. So they further will deal with, and we were gonna, we will cover shortly the issues relating to whether the firm is barred, if the lawyer is barred. Because although an individual lawyer may be disqualified, it may or may not implicate the entire firm. Thinking about whether or not the new firm is completely barred, we look at rule 110, 1.10. And so if a particular lawyer is at a firm and the lawyer is barred, generally speaking, the firm should be barred from representing a client when the individual lawyer would not have been permitted to do so. Although there are other issues that can be considered. So there are various situations in which, even though an individual were cannot participate, the firm can participate. If the firm is screened from participation in the matter and gets no part of the fee from that matter. And in addition, the, client that's affected gets written notice promptly so that the former client is the ability to ascertain whether or not the firm is in fact, complying with these obligations. I wanna talk about screening. It's really interesting, but because we now work in a situation where so much is done by technology, there are ways through technology that individual files can be blocked, so that only specific people have access, and also that others have no access. And I certainly have been involved in situations where particular lawyers may not be able to have any access to information that's on the system. You need to also make sure that if there are hard copies and things are laying around, so to speak that the lawyers cannot have access to that either. Long before we relied on technology, as heavily as we do now, I was involved in multiple matters where firms had screening involved, and the documents were kept in locked cabinets with large, bold labels on the cabinet outside stating that it was confidential. It could only be accessed by specific people and the like. So it's important to make sure that you take care of the screening so that it passes must and you won't be challenged later. Okay. Now we're going to look at what happens next. Not all of us leave law firms, not all of us move from one firm to another, or from a firm to a client. Some people move in and out of government. So the rules regarding changing those jobs are actually unique and distinctive. We have lawyers who may wanna leave a government position. One reason that happens for example is then when there's a change in administration, the attorney may no longer philosophically either agree with the new administration's policies or the attorney may be a political appointee who is either asked to resign or feels the attorney needs to resign. This also goes in the other direction, it's not uncommon for private practice lawyers, particularly in regulated areas, such as environmental law or securities or the life to leave a private practice position and accept a government position for some period of time to actually participate in enforcing the very types of things that lawyer was trying to fend off as a private practitioner. In either case there's a lot of issues that come up that are unique to those of us who move in and out of government. Let's chat about that next. So model rule one 1.11 deals with the specific conflict of interest issues that come up in this situation. So, first of all, let's start with the lawyer who's worked in government and wants to move. Section A says a lawyer who has formerly served as a public officer or employee of the government is subject obviously to the duties generally regarding former clients, which we talked about regarding conflicts as to former clients. But in addition, the lawyer leaving government shall not otherwise represent a client in connection with a matter in which the lawyer participated personally and substantially as a public officer or employee, unless the government agency gives its informed consent in writing. Okay. So let's start with that one. There are people who leave government who are in a, let's say very specific niche and do very specific work and frequently are recruited because of that expertise. But once the person leaves the government job and goes to a firm, the person can't just switch sides unless the government agency gives informed consent. However, there is some confusion and often debate about what does it mean for a lawyer to participate personally and substantially. An example I can think of is I actually worked in a government position over 20 years ago, actually, in which I supervised about 75 trial lawyers handling couple of thousand cases a year in a variety of areas. Now I wasn't personally involved or substantially involved at all 2000 of those matters. It wasn't possible. So when I left that position of the change of administration to go into private practice, I had to be careful to be sure that I did not get involved in a matter where it could be perceived that I was personally and substantially involved. And I took the appropriate steps to do so. But if there's any doubt, you always can go to the government agency, have them to confirm that in writing that they don't perceive that you were personally substantially involved or that they permit you to handle the representation anyway. Assuming that you have left government practice, as I did and your firm is approached about handling a matter, adverse the government agency, where you worked and assume that you or I couldn't take on that matter, because we did meet that test of personally, particularly personally, and substantially participating. If that's the case, then another lawyer in the firm can't do it either. Unless certain conditions are met. You have to make sure that the former government lawyer, which would've been me and maybe you in your situation is screened. Doesn't share in the state. Those are pretty clear, which I've already talked about. But you again, need to notify the government agency so that the gov in writing so that the government agency has time to assure that you are in fact, meeting these standards to assure there's no ethics violation. There's a flip side to this. What if you are working in the government, but you really wanna move to private practice? Maybe you don't have a choice, maybe the administration's changing and you have to go, you need to also follow very strict rules that I'm going to both in terms of what you can work on, which is covered in 2A, D2A about making sure if you participated personally, substantially. That in the government matter, you can't do it in private practice without informed consent in writing from the government agency. The rule that I think we should focus on for the moment is negotiating employment when you're leaving the government, especially since frequently, you're gonna be negotiating for jobs with people who know what you do. You need to be sure that you, if you're negotiating that you do not negotiate with someone who has been involved with you personally and substantially in certain roles you played, we're gonna come back to this as well, shortly. Next case studies. So in addition to the various rules, I just talked about, if you are going to leave or join government, there are always likely to be state laws, federal laws, municipal laws that apply to what you can do on top of the legal ethical rules and regulations. I know from my own experience that you have to also look at those rules. There frequently are bans on doing certain kinds of work, for an extent, a certain period of time perhaps a year, without getting various types of permission. You must make sure you follow that. So for example, there may be a law or regulation that says that even if it's a matter, that has nothing to do with what you did in the government, when you go to private practice, you can't be adverse to the government for a certain period of time without a waiver. So you need to look beyond the ethical rules in both the examples I talked about. So here's another situation that comes up. It's not perhaps as common as people going into and out of traditional government roles, but it comes up with people who serve in a judicial type capacity judges, arbitrators, law clerks, and the like. Let's think about this. Let's imagine that you are a judge who have been on the bench for 20 years and you really love it. You don't wanna do anything else if you could do your heart's desire, but you see that your peers in private practice are just bringing in the money and they are prepared for a more comfortable retirement. And you start to get concerned about yourself and your family in that regard. And you begin to consider whether you ought to give up the job on the bench, that you love to join a powerful firm in your jurisdiction so that you can make more money before you retire. But of course, as a judge in that jurisdiction, you probably have had the firms that you're interested in appear in front of you. Similarly, many people either right after leaving law school at some other point, clerk for judges, and when your clerkship is over, 'cause it normally will have a one or two year term with some exceptions, you need to get another job. And if you've been clerking in a certain city, that may be where you wish to remain. And again, you may have worked on matters with your judge involving law firms that you'd like to work for. Finally, you may be a lawyer in private practice who works as well as a neutral arbitrator, as well as handling cases. And you've been handling an arbitration dispute between two companies, neither of which your firm represents because you did the appropriate conflict check before you took on the matter. But while the arbitration is still pending and not concluded, and you are still the arbitrator, one of the parties in the arbitration wants to retain another lawyer at your law firm to represent that company in an unrelated matter. These are all significant issues that are addressed by model rule 1.12, but also by some outside considerations, which I'll flag shortly. So if you want to move from being a neutral or a neutral type rule into private practice, you start with this. A lawyer shall not represent anyone in connection with the matter in which felt lawyer participated personally substantially as a judge or adjudicative officer or clerk or as an arbitrator, unless all parties give inform consent confirmed in writing. So obviously if a judge moves to private practice and goes to a firm, the judge cannot participate as counsel for anyone in that dispute without informed consent confirmed in writing. And again, since I think this would be a really bad move, no matter what for someone to do, you wanna be sure that in terms of informed consent, you inform the parties involved in writing also that they should seek independent counsel in assessing whether or not there this is acceptable to them. The other thing is you're not supposed to negotiate for employment with anyone who's involved as a party or a lawyer for a party in a matter in which you are for example, the judge handling the matter or arbitrator or other kinds of third party neutral. However, the rules are a little different for law clerks. Law clerks, two judges and other adjudicated officers can negotiate for employment with the party or a lawyer, even if there is a matter in which the clerk worked on, but that law clerk must first notify the judge or other officer for whom they work and get permission to do so and put them on notice because the difference is law clerks don't make decisions, but similarly, there is a concern. And if a judge knows that a law clerk is negotiating with a particular firm, it is probably prudent to have that law clerk screened from and not work on that matter, particularly while this is going on. 'Cause I do think it gives an appearance if nothing else of impropriety. Again, as the issues with imputation of conflict supply when you move from firm to firm, if a lawyer who was a judge or other type of legal officer we're talking about here is disqualified under this rule the firm also should not knowingly undertake or continue a representation in the matter unless the disqualified lawyer is screened and is takes, no part in the fee. And the appropriate written notice is given. I wanna focus specifically now on what this means for various people in this role, which we've been talking about. If the judge is considered leaving the bench, you know that once that happens, the judge can't work on something for a particular party. If he was personally or she was personally and substantially involved, unless there's inform written consent, which should invest strategy include notice of the various things we're talking about. I'm going to jump ahead now because I think there's a number of other things that we should address. First of all, what if you can't continue to represent a client when you change jobs? You wanna make sure that you give the client appropriate, notice that you get approval from the court to withdraw. And the like. In addition, the rule on terminating representation is very clear. And if you're going to stop representing a client and the former firm is not going to continue, you need to follow the steps specifically in rule 1.116 and especially the optional withdrawal rules and assisting the client in withdrawing. These are somewhat beyond the scope of what I intended to cover, but I wanna flag them for you. So if they apply to you, you can attend to them . Next you know that the rule 8.4 is the global misconduct rule. And I urge you to be sure to be clearly honest and be sensitive to administration of justice when you are making changes from one firm to another. In conclusion, we need to know our ethical obligations, our contractual obligations and our fiduciary duties when we change jobs and abide by all of them. We wanna make sure we do that so that clients can have the appropriate choice of who they want to represent them. We wanna make sure their interests are protected and they are not harmed when we make a move. And also we wanna make sure that our duties to avoid conflicts and maintain confidentiality are preserved. By doing these things you will minimize ill will with former employers, with your clients and also spare yourself and your new firm with your new job, lots of issues, and reduce the risk of litigation. Thank you so much for joining me today and for listening to my comments on avoiding burning bridges. You are always welcome to contact me directly at my contact information so that you can follow up if there are questions I haven't addressed. Good luck with your future jobs. Thank you.

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1h 3m 49s

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