Ethical Constraints on Subpoenaing Clients
LACBA Update, March 2012
By Carole J. Buckner, Dean of the School of Law and Chief Academic Officer of Abraham Lincoln University. A member of the LACBA Professional Responsibility and Ethics Committee, she practices law through Buckner Law Corp. in the area of professional responsibility and can be reached at firstname.lastname@example.org. The opinions expressed are her own.
You receive an irritated call from one of your law partners asking, “Did you just serve a subpoena on my client?” This may happen if you practice with a law firm of any significant size. Or perhaps your client has asked you to serve a subpoena on a person or company that is a client of your firm. Can you do that? One step further back, suppose a prospective new client is sitting in your office, and as you discuss the potential new matter, you realize you will need to seek discovery from another client of your firm. Is there any way you can still take the client? This scenario raises several ethical issues involving conflict of interest and the duty of loyalty as well as concerns involving the duty of confidentiality.
A recent California State Bar ethics opinion provides practical guidance on how to address this scenario when it arises at the client intake stage.1 In the process of taking on a new client, attorneys should check for conflicts of interest by running a conflict check not only for adverse parties but also for adverse witnesses.2 Proposed revisions to the California Rules of Professional Conduct provide that lawyers should establish reasonable procedures for checking conflicts based on the size and type of firm, and that ignorance resulting from a failure to institute such procedures will not excuse a violation of the conflict of interest rules.3 During litigation, as the scope of a matter develops, the State Bar opinion indicates that attorneys should “refresh” the conflicts check when new parties or witnesses appear.4 Such practices allow the attorney to identify and address conflicts of interest before adverse impact to an existing client or a prospective new client.
The primary concern when a lawyer must subpoena one client on behalf of another client is the potential for a conflict of interest, in that a lawyer is in a position to compromise the interests of the prospective client on behalf of an existing client and vice versa. Conducting third-party discovery on behalf of a new client is adverse to the firm’s existing current client.5 Such a scenario jeopardizes the lawyer’s duty of loyalty to both the existing client and the prospective new client.6 The duty of confidentiality could also be compromised because a lawyer could use confidential information about one client for the benefit of another.7 The lawyer’s own pecuniary interests in maintaining continued business from the existing client witness creates a further conflict of interest.8
Where the lawyer learns of the conflict of interest at the inception of the representation, the lawyer must be confident that he or she can properly execute the lawyer’s professional obligations, including the duty of competence, to the prospective client. If so, before proceeding, the lawyer must obtain informed written consent from both the existing client and the prospective client following disclosure of the relevant facts and possible consequences.9 In making the required disclosures, the lawyer must bear in mind that the duty of confidentiality limits the information that may be disclosed without client consent.10 In some circumstances, conflicts of interest cannot be resolved with informed written consent.11 Where the consent of both clients cannot be obtained, the lawyer may not take on the prospective new client.
More likely, the lawyer had no idea at the time of the new client intake that to competently represent the new client the lawyer would need to subpoena documents from another existing client of the firm. An attorney’s understanding of the scope of the case at the inception of the representation may not reveal the necessity of subpoenaing another client of the firm until a later date.12 Where the conflict of interest materializes after commencement of the representation, the lawyer who examines another client as an adverse witness in a matter unrelated to the lawyer’s representation of the other client, or who conducts third-party discovery of a client in such a matter, faces a disqualifying conflict of interest.13 Unless the lawyer can obtain proper conflict waivers from both clients, the lawyer will normally be disqualified, and the conflict will be imputed to the lawyer’s firm.14
Whether associating separate counsel to conduct the necessary discovery of the firm’s other client will resolve the conflict of interest is debatable. One state court disqualified a firm after it served discovery on another current client even though the firm had withdrawn and associated other counsel for that party.15 A federal court questioned the independence of a firm brought in to serve discovery on a former client to resolve a conflict of interest.16 These authorities suggest that bringing in separate counsel may not be adequate to resolve a conflict arising from the necessity of subpoenaing one client on behalf of another client.17
Effectively addressing conflicts of interest at the inception will minimize the risk of a firm’s disqualification when subpoenaing one client on behalf of another.
1 State Bar of Cal., Standing Comm. on Prof'l Responsibility & Ethics, Formal Op. 2011-182, at. 5.
3 Proposed Cal. R. of Prof'l. Conduct R. 1.7, comment .
4 State Bar of Cal., Standing Comm. on Prof'l Responsibility & Ethics, Formal Op. 2011-182, at. 5.
6 ABA Standing Comm. on Ethics and Prof'l Responsibility, Formal Op. 92-367 (lawyer could be tempted to “soft pedal” his zeal in furtherance of interest of another client, such as undertaking a “soft” cross-examination).
7 Id. (lawyer may use specific confidential information or familiarity with client’s practices to the client’s disadvantage in conducting discovery); Oasis West Realty LLC v. Goldman, 51 Cal. 4th 811, 823 (2011) (lawyer may not use or disclose confidential client information).
8 ABA Standing Comm. on Ethics and Prof'l Responsibility, Formal Op. 92-367.
9 State Bar of Cal., Standing Comm. on Prof'l Responsibility & Ethics, Formal Op. 2011-182, at. 5.
12 One example discussed in ABA Formal Opinion 92-367 is that a lawyer may encounter the client as an adverse expert witness. See also Los Angeles County Bar Ass'n, Prof'l Responsibility & Ethics Comm., Formal Op. 513 (former client as expert witness).
13 ABA Standing Comm. on Ethics and Prof'l Responsibility, Formal Op. 92-367.
15 Cal West Nurseries, Inc. v. Superior Court, 129 Cal. App. 4th 1170 (2005) (service of discovery on a party).
16 UMG Recordings, Inc. v. MySpace, 526 F. Supp. 2d 1046 (C.D. Ca. 2007) (second firm engaged to serve discovery on party previously represented by firm).
17 Compare ABA Standing Comm. on Ethics and Prof'l Responsibility, Formal Op. 92-367 (suggesting using co-counsel to address midstream conflicts may be permissible).