These summaries were prepared by McGuireWoods LLP lawyer Thomas E. Spahn. They are based on the letter opinions issued by the Virginia State Bar. Any editorial comments reflect Mr. Spahn's current personal views, and not the opinions of the Virginia State Bar, McGuireWoods or its clients. 
 
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  Topic: 71 - Representing Corporations
LEO NumTopicsSummaryDate
1172

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57-In-House Lawyers

71-Representing Corporations

(The original LEO 1172 appeared to indicate that an in-house lawyer did not have an attorney-client relationship with the employer, but a later clarification corrected this error.)12/19/1988
0835

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38-Fee Splitting

57-In-House Lawyers

71-Representing Corporations

[WITHDRAWN 9/16] An in-house lawyer who represents the company in collection matters may not split any attorneys' fees collected with the company, unless the amount is a reimbursement for the actual cost of the lawyer's services. [This Legal Ethics Opinion was overruled to the extent its holding is inconsistent with LEO 1783 which permitted a lawyer representing a lender in collecting on a note containing a provision for the award of 25% attorney's fees of the principal balance due to give the client/lender whatever portion of the 25% was not actually spent on attorney's fees.]10/9/1986
1836

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9-Government Lawyer Conflicts

15-Representing Other Entities - Miscellaneous

71-Representing Corporations

A city attorney represents the city which, pursuant to its charter, acts through an elected mayor, a city council, and a chief administrative officer. If asked by a city council member to prepare an ordinance that would affect the relationship between the city council and the mayor, the city attorney does not have a duty to keep the draft ordinance a secret from the mayor. Absent an organizational policy to the contrary (which would guide the city attorney's disclosure obligations), the city attorney may advise all of the city's constituents of the ordinance if the city attorney determines that the disclosure is in the best interest of the ultimate client (the city). The same is true of the city attorney's disclosure to other members of city council. If a conflict develops between various city constituents, the city attorney may be obligated to suggest that one or more of the constituents engage independent counsel. Although "an organization may adopt appropriate procedures for managing internal conflict issues," the city charter's language requiring the city attorney to represent all city constituents makes it highly unlikely that the city attorney could arrange for different subordinates in his office to represent the city council and the mayor (without sharing information about those separate representations). The charter authorizes the mayor to employ special counsel if a conflict arises with other city constituents. Unless the city attorney's representation of the city will be materially limited, the city attorney can represent all of the city's constituents even if there are policy issue differences among them. If the interest of one constituent becomes adverse to the organization's (city's) interest, that constituent should obtain separate representation. As the city's lawyer, the city attorney "may render legal opinions or conclusions with which a [city] constituent might strongly disagree or perceive as favoring another constituent."5/6/2008
1066

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2-Adversity to Former Clients

71-Representing Corporations

A corporate lawyer represented one of the corporation's employees in a dispute over the building of his home. The representation later ends, and the employee never pays the lawyer. Approximately one year later, the employee leaves the corporation. The lawyer may now represent the corporation in a dispute with the former employee over a non-competition agreement, because the current matter is not substantially related to the representation involving the former employee's home, and the lawyer had not gained any material confidences during the earlier representation. 4/18/1988
ABA-381

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71-Representing Corporations

A corporation may not demand and an outside lawyer may not accept a retainer agreement in which the outside lawyer pledges never to represent anyone against the corporation in the future. 5/9/1994
1341

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13-Marketing - Miscellaneous

53-Office Sharing with Non-Lawyers

55-Firm Names and Letterhead

57-In-House Lawyers

71-Representing Corporations

A firm's letterhead may include a retired former partner's name as long as the former partner is accurately characterized. Corporate counsel must disclose the name of the corporate employer on letterhead and business cards. If a lawyer operates a private law practice out of a company's office, there must be separate office space, separate sign, separate files and a separate telephone listing. 4/20/1990
0807

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2-Adversity to Former Clients

57-In-House Lawyers

71-Representing Corporations

A former in-house general counsel to a corporation may not represent the lawyer's new employer in pursuing litigation against the former employer on matters in which the lawyer was involved as an employee of the former employer. This disqualification extends to the other lawyers on the general counsel's staff of the new employer. 6/25/1986
0718

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2-Adversity to Former Clients

57-In-House Lawyers

71-Representing Corporations

A former in-house lawyer may not represent a client against the former employer on a substantially related matter. The disqualification extends to the lawyer's entire firm. 8/30/1985
1419

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2-Adversity to Former Clients

5-Lawyers Changing Jobs

57-In-House Lawyers

71-Representing Corporations

A former in-house lawyer who advised a corporation's subsidiary may not now be adverse to the subsidiary after leaving the company, even if the lawyer has no recollection of involvement in the pertinent matter and claims not to have any confidential information. 6/25/1991
1638

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24-Representation of or Adversity to Witnesses

31-Protecting and Disclosing Confidences and Secrets

71-Representing Corporations

A law firm has occasionally represented (and is currently representing) a corporation, gaining "general knowledge of the scope and nature of the corporation's operations." The corporation's president has now been identified as an expert witness for the law firm's adversary in an unrelated matter.Although the firm has not represented the president personally, if "the law firm had any discussions with, or received any information from the president, such communications would give rise to an expectation of confidentiality unless it gave the president the disclosures and warnings required under the circumstances presented in LEO 1457" (since an expectation of confidentiality may arise even without a formal attorney-client relationship). For this reason, the law firm may continue to represent its client only if "it has gained no information from the president under any circumstances that would have indicated an expectation of confidentiality as discussed above, or if no such information thus gained can be of any use whatsoever to the current defendant so that the law firm will not need to use it, or if the president consents after full disclosure, or if the president was adequately warned that what he told the law firm would not be held in confidence because the law firm did not represent him or his interests."The Bar notes that the law firm has had occasion to acquire useful information about the company and the president's credibility, although the Bar only mentions that the firm "has gained general knowledge of the scope and operation of the corporation."The law firm must also obtain the consent of its other client to continue representing it in the unrelated case. [The Bar did not discuss the possibility of arranging for another counsel to cross-examine the expert.] 4/19/1995
1352

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3-Multiple Representations on the Same Matter

4-Witness-Advocate Rule

30-Disclosing Confidences Under Court Order

66-Lawyers Acting as "Scriveners"

71-Representing Corporations

A lawyer acted as a "scrivener" for two shareholders of a corporation attempting to reach an agreement (the lawyer had represented the company, and therefore properly declined to represent either shareholder in their dispute). The Bar warned that a lawyer acting as a "scrivener" faces multiple representation problems, especially if the parties are not otherwise represented by lawyers. If a dispute arises between shareholders of a closely held corporation, the lawyer may not play any role if the lawyer had been the corporation's lawyer. If one of the parties called the lawyer to testify, the lawyer should move to quash the subpoena. If the court denies the motion, the lawyer may testify. [Superseded in LEO 1803, which held that the existence of an attorney client relationship depends on the lawyer's action rather than a mere title, and holding that the attorney client relationship would arise between prisoners and lawyers practicing at a state prison if the lawyers did anything more than simply typing up what the prisoner wrote].5/8/1990
1126

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3-Multiple Representations on the Same Matter

66-Lawyers Acting as "Scriveners"

71-Representing Corporations

A lawyer acted as scrivener in representing one corporation making an agreement with another corporation. Now that the arrangement has fallen apart, the lawyer may represent the corporate client, because the other corporation was never a client. [Superseded in LEO 1803, which held that the existence of an attorney client relationship depends on the lawyer's action rather than a mere title, and holding that the attorney client relationship would arise between prisoners and lawyers practicing at a state prison if the lawyers did anything more than simply typing up what the prisoner wrote].8/11/1988
1615

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5-Lawyers Changing Jobs

12-Withdrawing Lawyers (Including Non-Compete Issues)

31-Protecting and Disclosing Confidences and Secrets

57-In-House Lawyers

71-Representing Corporations

A lawyer hired as a company's inside general counsel may not enter into a non-competition agreement with the company (under which the lawyer could not serve as any competitor's in-house counsel for a period of one year). The Bar notes that the lawyer must protect the former client's confidences and secrets if the lawyer begins to represent a competitor. 2/7/1995
0785

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5-Lawyers Changing Jobs

71-Representing Corporations

A lawyer leaving a firm that represents a corporation (but who did not work on corporation's matters) may represent a plaintiff against the corporation in a related matter, because the current representation is not adverse to the corporation. 5/16/1986
1593

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8-Bills and Fees

16-Lawyer's Personal Interests

71-Representing Corporations

A lawyer may accept compensation in the form of corporate stock for legal services as long as: "he feels his independent professional judgment will not be affected by his status as a stockholder;" the client consents after full disclosure; and the transaction "is not unconscionable, unfair or inequitable when made." [Under Rule 1.8(a), a lawyer may not enter into a "business transaction" with a client unless the client is given an opportunity to seek independent advice, and there has been full disclosure and consent in writing.]4/11/1994
0815

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64-Lawyers Acting as Deed of Trust Trustees

71-Representing Corporations

A lawyer may act both as a loan officer and as counsel to a corporation as well as trustee under deeds of trust securing its loans. 9/19/1986
1589

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25-Dealing with Unrepresented People

57-In-House Lawyers

71-Representing Corporations

78-Communicating with an Employee of a Corporate Adversary

A lawyer may communicate directly with a former employee of an adverse party unless the lawyer knows that the former employee is represented by counsel. A corporation's lawyer may not simply advise a former employee that the lawyer is representing the former employee individually and direct the former employee not to speak with opposing counsel. Former employees have the right to choose their own counsel, and until they have done so the corporation's lawyer must treat them as unrepresented parties with potentially adverse interests (and thus may only advise them to secure counsel). [Rule 3.4(g) allows a lawyer to request that former employees of a corporate client "refrain from voluntarily giving relevant information to another party" under certain circumstances.]4/11/1994
0304

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2-Adversity to Former Clients

24-Representation of or Adversity to Witnesses

48-Criminal Defense Lawyers

71-Representing Corporations

A lawyer may defend a corporate client in a criminal matter although the lawyer had previously represented a corporate officer who is a forced witness (after receiving immunity) in the matter, as long as the witness' credibility will not be challenged and both the corporate client and officer-witness consent.11/2/1978
0438

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2-Adversity to Former Clients

71-Representing Corporations

A lawyer may not represent a corporation against an employee's estate when the lawyer's firm had previously represented the employee in the same matter. 11/17/1981
0344

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1-Adversity to Current Clients

71-Representing Corporations

A lawyer may not represent a party against a corporation when the lawyer's partner is currently representing the corporation's sole stockholder in an unrelated matter. 7/30/1979
0384

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3-Multiple Representations on the Same Matter

71-Representing Corporations

A lawyer may not represent both a corporation and its president (who is also the corporation's majority stockholder) if the corporation has a potential claim against the president. 8/5/1980
0654

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3-Multiple Representations on the Same Matter

31-Protecting and Disclosing Confidences and Secrets

71-Representing Corporations

A lawyer may not reveal any confidential information jointly obtained from a former corporate and individual clients who are now adverse to one another. 1/17/1985
0991

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71-Representing Corporations

A lawyer may represent a Chamber of Commerce (which is a separate corporation) while at the same time suing one of the Chamber's members, as long as the lawyer discloses the lawyer's role to both clients who are Chamber members, and the Chamber [it is unclear from the LEO whether the lawyer must obtain consents, although the summary indicates that the lawyer must do so.] 11/4/1987
0894

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1-Adversity to Current Clients

71-Representing Corporations

A lawyer may represent a corporation which is adverse to the lawyer's client in litigation but which has assigned right against another individual to the lawyer. 4/1/1987
0580

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3-Multiple Representations on the Same Matter

71-Representing Corporations

A lawyer may represent both a corporation and a former employee on unrelated matters, but may not also represent either one in their dispute against the other. 5/31/1984
1325

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8-Bills and Fees

36-Withdrawal from Representations

71-Representing Corporations

A lawyer may withdraw from representing a corporation which refuses to pay its bills, defames the lawyer and threatens the lawyer with physical danger. The lawyer may then sue the former client for past-due bills. [The lawyer requesting the opinion practices in another country. The choice of law issues are now governed by Rule 8.5 -- although the conclusion seems consistent with every state's ethics rules.]2/27/1990
1408

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1-Adversity to Current Clients

18-Consent and Prospective Waivers

71-Representing Corporations

A lawyer represented a borrower in an action brought by a bank's real estate loan division. One of the lawyers' partners was later hired by the bank's commercial finance division in unrelated litigation. The commercial finance division consented, recognizing that the two divisions of the bank act independently.The Bar held that there were "inherent dangers" in these two representations despite the bank's indication that the subdivisions are distinct from each other. Because both divisions "are part of the same entity managed under the same supervisory scheme," there was a danger of "misuse of the client's information." The Bar held that the simultaneous representation was improper and could not be cured by consent (because it was not "obvious" that the lawyer could adequately serve both clients). [The Bar's conclusion that consent would not cure this conflict would almost surely be different under Rule 1.7(a)'s "reasonably believes" subjective standard rather than the old Code's "obvious" standard.]5/13/1991
1347

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17-Fraud on the Tribunal

31-Protecting and Disclosing Confidences and Secrets

71-Representing Corporations

A lawyer represented a corporation in settling a claim with an insurance company after the corporation's offices are burglarized. The lawyer later learned that corporate officers may have staged the burglary.The Bar held that a lawyer is permitted to reveal to a third party information which "clearly establishes" this the client has committed fraud. Likewise, a lawyer must reveal to a court information which "clearly establishes" that the client has committed fraud on the tribunal. The only information that "clearly establishes" the client's fraud is the client's acknowledgment to the lawyer that the client has committed a fraud. Even the arrest or conviction of the client "would not be relevant to the attorney's ethical duty" because the "only way" to "clearly establish" the fraud is by the "acknowledgment of the client." 6/28/1990
1499

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3-Multiple Representations on the Same Matter

71-Representing Corporations

A lawyer represented a corporation which had six shareholders. After the shareholders began to quarrel, one of the shareholders planned to sue the other shareholders (and perhaps the corporation as well). Assuming that the corporation's lawyer had not "met with or received confidences as to the corporation or otherwise" from the potential plaintiff shareholder, the lawyer may continue to represent the corporation and the four shareholders who might be sued. The lawyer must withdraw from representing both the shareholders and the corporation should a conflict develop between them. 12/14/1992
1596

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2-Adversity to Former Clients

31-Protecting and Disclosing Confidences and Secrets

71-Representing Corporations

A lawyer represented a corporation's president in 1989 and 1990, until the president resigned. New managers now run the corporation. Because the lawyer no longer represents the corporation or any of its officers, the lawyer may now represent an employee in a defamation lawsuit against the corporation -- because (1) there is no relationship between the defamation action and the lawyer's earlier representation; and (2) the lawyer did not acquire any relevant confidences. "Attorney's familiarity with the Corporation's operations or the personalities of its management, without more, is not a disqualifying conflict of interest." The lawyer might have to withdraw if a "finder of fact" determines that "either the matters were substantially related or that [the lawyer] did in fact receive secrets and confidences of President or [the] Corporation." 6/14/1994
1536

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2-Adversity to Former Clients

5-Lawyers Changing Jobs

7-Family Conflicts

31-Protecting and Disclosing Confidences and Secrets

54-Insurance Defense Lawyers

71-Representing Corporations

A lawyer represented an insurance company's insureds and also represented the company in coverage issues. The Bar affirmed that the insured is the client of an outside lawyer selected by the carrier to represent the insured (relying on LEO 598). Once the lawyer leaves the firm, the lawyer may represent plaintiffs against other insureds (because "there was no attorney-client relationship" between the lawyer and the insurance company) as long as the new representations are not the same or substantially related to the specific matters on which the lawyer represented the company's insureds at the lawyer's old firm. [The Bar's conclusion that there was "no attorney-client relationship" between the lawyer and the insurance company seems inconsistent with its earlier statement that the lawyer handled "coverage issues" for the insurance company.] The lawyer's "familiarity with the general operation of [the insurance company] does not constitute a confidence or secret." Although the lawyer's spouse is an insurance company employee with access to claim files, the lawyer will not be disqualified as long as the lawyer has not acquired any confidential information from the spouse. 6/22/1993
1340

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3-Multiple Representations on the Same Matter

71-Representing Corporations

A lawyer representing a corporation may also represent two of its employees in an action against a third party. If the employees wish to assign part of their recovery to the corporation, the lawyer must obtain consent from all three clients and be able to adequately represent the interests of each in negotiating the assignment. 4/20/1990
0400

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3-Multiple Representations on the Same Matter

71-Representing Corporations

A lawyer representing a corporation with two shareholders may not represent either shareholder if they become adverse. 1/19/1981
1505

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3-Multiple Representations on the Same Matter

18-Consent and Prospective Waivers

71-Representing Corporations

A lawyer represents both a corporation and its chairman (who is sued in both individual and fiduciary capacities). On appeal, the plaintiff raised issues outside the record that hurt the chairman. The chairman wants the lawyer to correct the statements, but the lawyer refuses to do so because it might hurt the corporation. Because there is an actual conflict between the corporation and the chairman, the lawyer must withdraw from representing both. Because it is obvious that the lawyer may not adequately represent the interests of the corporation and the chairman, consent would not cure the conflict. [The Bar's conclusion that consent would not cure this conflict almost surely would be different under Rule 1.7(a)'s "reasonably believes" subjective standard rather than the old Code's "obvious" standard.]12/14/1992
0990

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2-Adversity to Former Clients

71-Representing Corporations

A lawyer who formerly represented a closely held corporation (on small collection matters unrelated to corporate structure, policy or the relationship between the shareholders) may represent one of the two 50% shareholders in litigation against the other shareholder. 11/4/1987
0272

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16-Lawyer's Personal Interests

31-Protecting and Disclosing Confidences and Secrets

71-Representing Corporations

A lawyer who has represented a corporation may answer a government agency's questions about the lawyer's purchase of stock in the corporation. 10/27/1975
0555

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31-Protecting and Disclosing Confidences and Secrets

32-Lawyers Acting in Other Roles (Miscellaneous)

63-Lawyers Acting as Corporate Officers or Directors

71-Representing Corporations

A lawyer who is acting as counsel, shareholder, officer and director of a corporation must maintain as confidential any information the lawyer has obtained from a fellow stockholder, director and officer because the conversation was with the lawyer as counsel for the corporation. [The lawyer would be free to reveal the information to the corporation's management.] 4/10/1984
1685

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2-Adversity to Former Clients

71-Representing Corporations

73-Family Law Lawyers

A lawyer who represented a corporation owned by three shareholders (approximately six years earlier) may now represent the corporation's sole remaining shareholder's wife in a divorce, as long as the lawyer "never represented the shareholder individually" and "no confidences or secrets were obtained from the shareholder or the corporation during [the lawyer's] representation of the corporation that would be pertinent to the divorce action" (the lawyer "did not perform any work necessitating an evaluation of the corporation or any review of financial records of the corporation"). 9/23/1996
1517

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4-Witness-Advocate Rule

71-Representing Corporations

A lawyer who represented corporations equally owned by two shareholders may represent one of the shareholders in alleging that the other shareholder breached fiduciary duties, because the lawyer never represented the defendant shareholder individually (as long as the lawyer had not obtained any confidences from the defendant shareholder while the lawyer represented the corporations). The lawyer need not withdraw because opposing counsel threatens to call the lawyer as a witness unless it becomes apparent that the lawyer's testimony is or may be prejudicial to the client. 4/12/1993
1551

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3-Multiple Representations on the Same Matter

7-Family Conflicts

45-Law Firms - Miscellaneous

71-Representing Corporations

A lawyer who represents companies that compete with a company employing the lawyer's non-lawyer fiancé may continue to represent the clients as long as they are only adverse "in a business setting" to the fiancé's employer and "unless and until any two or more clients become adverse to each other in legal matters." Any disqualification of the lawyer based on the engagement is not imputed to the other lawyers in the firm. 10/20/1993
0484

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63-Lawyers Acting as Corporate Officers or Directors

71-Representing Corporations

A lawyer who serves as general counsel for and a member of the Board of Directors of a hospital and nursing home may sit on a medical malpractice panel as long as the lawyer avoids conflicts. 11/8/1982
0803

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2-Adversity to Former Clients

71-Representing Corporations

A lawyer whose firm formed a corporation may represent one of the shareholder's wives against the shareholder, unless the lawyer learned material confidences in the earlier representation. 5/27/1986
0803

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2-Adversity to Former Clients

71-Representing Corporations

A lawyer whose firm formed a corporation may represent one of the shareholder's wives against the shareholder, unless the lawyer learned material confidences in the earlier representation. 5/27/1986
0983

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31-Protecting and Disclosing Confidences and Secrets

57-In-House Lawyers

71-Representing Corporations

An in-house lawyer learns that a corporation has filed a false prospectus. The lawyer did not participate in preparing or disseminating the prospectus, and has now resigned from the in-house position. The lawyer may now reveal the fraudulent activity. The lawyer also has a duty to advise the corporation of the possible consequences of continuing its fraudulent activity, urge the corporation not to issue the prospectus and advise the corporation that the lawyer will reveal its conduct unless the corporation abandons its "criminal intentions." [Rule 1.13 provides guidance for lawyers in this situation.]10/27/1987
1353

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11-"Of Counsel" Relationship

57-In-House Lawyers

71-Representing Corporations

An in-house lawyer may also be "of counsel" to a law firm. However, there must be full disclosure and consent of the corporation for the law firm to do any of the corporation's legal work (even if the "of counsel" lawyer will not share in any of the fees). Moreover, outside counsel should communicate with a company lawyer other than the in-house lawyer who is also "of counsel" to the firm. 6/13/1990
0877

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34-Limiting Liability to Clients

54-Insurance Defense Lawyers

57-In-House Lawyers

71-Representing Corporations

An in-house lawyer may not obtain an indemnification agreement. [Rule 1.8(h) permits such indemnity agreements if the corporation is separately represented.]4/1/1987
1399

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2-Adversity to Former Clients

5-Lawyers Changing Jobs

57-In-House Lawyers

71-Representing Corporations

An in-house lawyer performed some work for the corporation's subsidiary. After leaving that position, the lawyer was hired by a company adverse to the subsidiary. The lawyer may represent the company, because the matter was unrelated to the work the lawyer had performed for the subsidiary while employed by the parent, and the lawyer had learned no confidences or secrets. 2/15/1991
0313

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2-Adversity to Former Clients

32-Lawyers Acting in Other Roles (Miscellaneous)

71-Representing Corporations

As long as both clients consent, a lawyer may represent a corporation in an action brought by another corporation the lawyer has previously represented and for whom a partner serves as registered agent. 4/4/1979
1129

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16-Lawyer's Personal Interests

71-Representing Corporations

As long as the client consents after full disclosure, a corporation's lawyer may represent the corporation in a breach of contract action even though the lawyer was to personally benefit under the contract that was breached. 10/28/1988
1364

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34-Limiting Liability to Clients

57-In-House Lawyers

71-Representing Corporations

Corporate counsel may not accept an indemnity commitment from their employer. [Rule 1.8(h) now permits such indemnity agreements if the corporation is separately represented.]6/28/1990
ABA-390

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71-Representing Corporations

Determining if representing one corporate affiliate and being adverse to another creates a conflict depends on: the lawyer's and client's understanding of which corporate entities are clients; the clients' expectations; the facts of the representation; the nature of the corporate affiliation (a client's affiliate corporation will only "rarely" be considered a client if the client does not own a controlling portion of the affiliate and the lawyer has had no dealings with the affiliate); and the sharing of any confidential information. Generally, such adversity is only "indirect". 1/25/1995
0254

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15-Representing Other Entities - Miscellaneous

71-Representing Corporations

Determining whether a lawyer may represent a corporation when the lawyer has been employed by one of two 50% shareholders over the objection of the other 50% shareholder is a legal rather than an ethical question. 12/3/1974
0256

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2-Adversity to Former Clients

4-Witness-Advocate Rule

57-In-House Lawyers

71-Representing Corporations

Former corporate counsel who resigned because of a dispute among the directors may not represent one of the directors in litigation arising from the dispute (both because of the conflict and because of the likelihood that the former corporate counsel "may be called as a witness"). 12/16/1974
1838

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8-Bills and Fees

57-In-House Lawyers

71-Representing Corporations

In-house lawyers can provide legal services to their employer's sister corporation, as long as the lawyers provide "independent professional judgment" on behalf of the sister company "free of any interference or direction" from the lawyer's employer, and as long as the lawyers do not share the sister company's confidences with their employer. The Bar explained (1) that "discharging this duty of confidentiality to [the sister corporation] may require [the lawyers] to work off site, at a physically separate office, rather than on the premises of [their employer]"; (2) that the lawyers must be conscious of possible conflicts between their clients, and should address conflicts "with a letter of representation that outlines who the lawyer would continue to represent, if either, in the event of a conflict"; (3) that the lawyers' employer can charge and collect legal fees from the sister corporation for the lawyers' work, as long as the amount is a simple reimbursement, and the employer does not earn any "direct or indirect profit for legal services provided."5/10/2007
0930

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71-Representing Corporations

It is not improper per se for a lawyer to continue representing a corporate board when two members of the board are satisfied with the lawyer and two are not. The lawyer must serve the interests of the board as a whole. 6/11/1987
ABA-410

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63-Lawyers Acting as Corporate Officers or Directors

71-Representing Corporations

Lawyers serving on a corporation's board of directors should: warn the corporation that their discussions with the board might not be protected by the attorney-client privilege (because they involve business advice rather than legal advice); assure that legal advice to the board is provided in a confidential setting (with non-essential corporate employees dismissed) and retained in a separate labeled file; avoid waiving the privilege on behalf of the corporation (which can occur because they are also directors authorized to waive the privilege); consider declining to represent the corporation in actions they opposed as directors; possibly arrange for other counsel to advise the board in matters involving the lawyer-director (to assure independent advice and the availability of an "advice of counsel" defense); consider abstaining from voting on any action involving retaining, paying or discharging the lawyers' firm (although the ABA rejects the New York City Bar's blanket prohibition on such activity); arrange for independent counsel to represent the corporation in litigation involving the directors or the lawyers' law firm (especially in a derivative case or if there are possible claims against the directors or the law firm). 2/27/1998
0772

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16-Lawyer's Personal Interests

50-Lawyer-Owned Businesses

71-Representing Corporations

There is no per se rule against a lawyer representing a company in which the lawyer owns stock. [Under Rule 1.8(a), a lawyer may not enter into a "business transaction" with a client unless the client is given an opportunity to seek independent advice, and there has been full disclosure and consent in writing.]3/11/1986

Copyright 2000, Thomas E. Spahn