Private Screening
| Jurisdiction | Colorado,United States |
| Citation | Vol. 38 No. 6 Pg. 59 |
| Pages | 59 |
| Publication year | 2009 |
2009, June, Pg. 59. Private Screening
June 2009
Vol. 38, No. 6 [Page 59]
Professional Conduct and Legal Ethics articles are sponsored by the CBA Ethics Committee. Articles published here do not necessarily reflect the legal interpretation of the Committee.
Coordinating Editor
Stephen G. Masciocchi, Denver, of Holland & Hart LLP--(303) 295-8000, smasciocchi@hollandhart.com
About the Authors
Richard Eason is of counsel to the law firm of Berenbaum, Weinshienk & Eason P.C. of Denver, where he specializes in commercial litigation and banking law--(303) 592-8338, rleason@bw-legal.com. Marcy Glenn is a partner at Holland & Hart, LLP, where she specializes in appellate litigation and legal ethics--(303) 295-8320, mglenn@hollandhart.com. John Lebsack is a shareholder of White & Steele, P.C., where he specializes in appeals and insurance coverage litigation--(303) 296-2828, jlebsack@wsteele.com. Traci Van Pelt is a member of McConnell Siderius Fleischner Houghtaling & Craigmile, where she specializes in the defense of lawyers in professional liability cases--(303) 480-0400, tvanpelt@msfhc.com. Alec Rothrock is a shareholder with the Englewood law firm of Burns, Figa & Will, P.C., where he practices in the areas of legal ethics and the law of practicing law--(303) 796-2626, arothrock@bfw-law.com. Susan M. Thevenet is in private practice specializing in business transactions and technology licensing--(303) 444-3563, susan@thevenetlaw.com. The authors are members of the CBA Ethics Committee.
Recent additions to the Colorado Rules of Professional Conduct explain the requirements for creation of ethical walls to prevent the imputation of conflicts when a lateral hire joins a law firm after working at another firm that represented an adverse party.
Colorado has joined the growing list of states that permit limited private screening--the creation of an ethical wall to cure a conflict created when a lawyer moves from one firm to another, without obtaining the consent of the affected former client. Private screening, if done properly and in the right circumstances, permits a firm to continue work on a matter notwithstanding a former client's refusal to waive a conflict. Private screening became possible on January 1, 2008, with the adoption of Colorado Rule of Professional Conduct (Colo. RPC) 1.10(e). In view of the enactment of that rule, the Ethics Committee of the Colorado Bar Association (CBA) withdrew its Formal Opinion 88, issued in 1991, which had addressed the subject of "confidentiality walls" under the former Colorado Code of Professional Responsibility.
To provide guidance to practitioners in applying new Colo. RPC 1.10(e), this article gives background concerning the rule. It also discusses the factors to be considered in deciding whether the rule will permit private screening under the circumstances and how to create a screen that complies with the rule.
The Colo. RPC are modeled after the American Bar Association (ABA) Model Rules of Professional Conduct (Model Rules). Although the Model Rules are not binding in any state, most states have used them as the basis for their own rules. The Colorado Supreme Court initially adopted the Colo. RPC effective January 1, 1993, based largely on the then-effective Model Rules. In 2002, the ABA House of Delegates revised the Model Rules on the recommendation of the ABA's Ethics 2000 Commission.(fn1) Effective January 1, 2008, the Colorado Supreme Court repealed and reenacted the Colo. RPC to reflect those portions of the Model Rules that the Court elected to adopt at that time, as well as other rule changes recommended by its Standing Committee on the Rules of Professional Conduct (Standing Committee).
When the ABA first approved the Model Rules in 1983, it distinguished between lawyers moving from government employment to private positions and those moving within the private sector. Original Model Rule 1.11(a) precluded a lawyer from working on any matter in which the attorney participated "personally and substantially" while a public officer or employee, absent the government agency's consent. It allowed other attorneys in the lawyer's new firm to work on such a matter, as long as the individually disqualified lawyer was screened and the firm gave the agency written notice of the steps it had taken to comply with the rule.
By contrast, original Model Rule 1.10(a) imputed to all lawyers in a firm all conflicts under Model Rules 1.7 (current client conflicts) and 1.9 (former client conflicts), including the individual conflicts of a lawyer moving from another private firm.(fn2) Based on this difference between Rules 1.11(a) (for lawyers moving from the public sector) and 1.10(a) (for lawyers moving within the private sector), the original Model Rules generally were understood to preclude private screening to cure a conflict created when a lawyer moved from one firm to another.
The Ethics 2000 Commission included a private screening provision in its recommended version of Model Rule 1.10(c), which the ABA rejected.(fn3) In 2008, a divided ABA Standing Committee on Ethics and Professional Responsibility (ABA Standing Committee) proposed another private screening provision, but the ABA tabled the measure by a single-vote margin.(fn4) In February 2009, the ABA approved the amendments to Model Rule 1.10 and its comments proposed by the ABA Standing Committee in 2008.(fn5)
New Model Rule 1.10(a)(2) allows a firm to avoid imputation of a lateral hire's former-client conflict if:
1) the individually disqualified lateral hire is timely screened from the matter and is apportioned no part of the fee;
2) the former client receives prompt written notice of the conflict and the screening steps so as to ascertain the new firm's compliance with the Model Rules; and
3) the screened lateral lawyer and the new firm provide the former client with certifications of compliance with the Model Rules and the implemented screening procedures at reasonable intervals on request and when the screening procedures are terminated.(fn6)
Since 2001, when the ABA first considered a private screening rule, the issue has been contentious. Proponents of private screening argue that the realities of modern law practice--including the existence of multistate and multinational firms and ever-increasing attorney mobility--warrant some form of private screening to avoid automatic imputed disqualification of lawyers who have no former client information. Opponents, however, believe that private screening sacrifices the rights of the former client--particularly its interests in confidentiality and loyalty--to the interests of the moving lawyer and hiring firm.(fn7)
In adopting the current Colo. RPC, the Colorado Supreme Court, with a few exceptions that are not relevant here, followed the recommendations of its Standing Committee, which reviewed the Model Rules over an eighteen-month period in 2004-05.(fn8) As discussed above, the Model Rules as adopted in 2002 did not permit unilateral screening. However, by the time the Colorado Supreme Court considered the issue in 2006-07, a number of other states already had rejected the ABA position and enacted rules permitting some form of private screening. The Colorado Supreme Court followed the national trend by adopting the following provisions that permit private screening in narrowly defined circumstances.(fn9)
Rule 1.0(k), defining "screened." Colo. RPC 1.0(k), which is identical to the Model Rule, defines "screened" as:
the isolation of a lawyer from any participation in a matter through the timely imposition of procedures within a firm that are reasonably adequate under the circumstances to protect information that the isolated lawyer is obligated to protect under these Rules or other law.
The comments for this definition make clear that it applies to private screening under Colo. RPC 1.10(e), discuss the purpose of screening, and emphasize the need to implement screening measures as promptly as possible.(fn10)
Rule 1.10(e), permitting unilateral screening. Under Colo. RPC 1.10(e), private screening is allowed and will avoid imputed disqualification only if the personally disqualified lawyer had not "substantially participated" in the matter creating the conflict while at the former firm. To prevent imputation, the screening must be timely; the screened lawyer must be apportioned no fee from the matter; the screened lawyer must give prompt written notice to the lawyer's former client and that client's current lawyers; and the screened lawyer and partners of the new firm must reasonably believe that screening will be effective to prevent the disclosure of material information to the new firm and its client.(fn11) These requirements are explored in greater detail below.
Comment [5A] to Colo. RPC 1.6, allowing disclosure of limited client information to perform conflict checks. In another departure from the Model Rules, the...
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