Ethics Breach May Violate State Consumer Protection Statute

• Pages: 8-8
• Date: 01 October 2023
• Author: Frances Codd Slusarz
• Subject Matter: Civil Law

Published in Litigation News Volume 49, Number 1, Fall 2023. © 202 3 by the American Bar As sociation. Reprodu ced with permission . All rights reser ved. This information o r any portion ther eof may not be copied o r disseminated in any form

or by any means or stored i n an electronic database o r retrieval syst em without the expr ess written co nsent of the American B ar Association.

awyers have more to worry about

than licensing issues when it comes

to violating professional ethics rules.

One federal court admitted

expert testimony regarding an attor-

ney’s purported ethics violations to

support a nonclient’s claim of unfair or

deceptive trade practices against an

opposing attorney. While the decision

may open the door for third parties to

sue lawyers who have harmed them,

ABA Litigation Section leaders do not

predict there will be a new wave of

unfair practices claims against attor-

neys by clients.

In Wyndham Vacation Ownership,

Inc. v. Sussman, a group of timeshare

developers sued a law f‌irm doing busi-

ness as Timeshare Exit Team (TET) and

its contract attorney for tortious inter-

ference with its contracts and violation

of the Florida Deceptive and Unfair

Trade Practices Act (FDUTPA). As its

name suggests, TET helped timeshare

owners get out of their timeshare con-

tracts. TET’s contract attorney reviewed

timeshare contracts and negotiated

with timeshare companies on behalf

of TET clients, even though he was

licensed in California and not in Florida.

In support of their FDUTPA

claim, the plaintis sought to intro-

duce expert testimony regarding

the contractor attorney’s violations

of California’s and Florida’s Rules of

Professional Conduct regarding fee-

sharing arrangements, supervision

of nonattorneys, attorney advertis-

ing, and the unauthorized practice of

law, among other things. A claim for

unfair or deceptive practices under the

FDUTPA “may be based upon.. .[a]ny

law, statute, rule, regulation, or ordi-

nance which proscribes unfair methods

of competition, or unfair, deceptive, or

unconscionable acts or practices.”

The contract attorney moved to

exclude the expert’s testimony for lack

of relevance, arguing that the preamble

to the Florida Rules of Professional

Conduct (FRPC) states that the ethical

Ethics Breach May Violate State

Consumer Protection Statute

rules do not give rise to independent

causes of action. The court disagreed,

pointing out that the preamble also

states that “since the rules do estab-

lish standards of conduct by lawyers,

a lawyer’s violation of a rule may be

evidence of a breach of the applicable

standard of conduct.” Because the

plaintis were not asserting claims for

violations of the FRPC, the court con-

cluded that the defendant’s ethical

violations could serve as evidence in

support of the plaintis’ FDUTPA claim.

Likewise, the court rejected the

defendant’s arguments that a jury

lacked jurisdiction to determine

whether he engaged in the unau-

thorized practice of law. Though the

prosecution of disciplinary actions is

reserved for the Florida Bar, the court

noted that the jury would simply be

considering whether the evidence of

defendant’s ethical violations consti-

tuted an unfair or deceptive practice—

not whether the defendant’s actions

had actually violated an ethical rule.

The court also dismissed arguments

that the expert’s opinions were unreli-

able because he did not perform sci-

entif‌ic analysis in forming his opinions,

as required by Daubert v. Merrell Dow

Pharmaceuticals Inc. It noted that no

scientif‌ic inquiry was required for ana-

lyzing compliance with the rules of pro-

fessional conduct and that Federal Rule

of Evidence 702 allows the testimony of

experts whose “specialized knowledge

will help the trier of fact to understand

the evidence.” Nor would the testimony

be equivalent to instructing the jury on

a legal issue because the expert would

not be opining on the ultimate issue in

the case—whether the lawyer violated

the FDUTPA.

According to Litigation Section lead-

ers, this decision is not likely to change

the claims clients bring against attor-

neys. “I do not expect to see clients

bringing trade practices claims against

their former attorneys because they

already have remedies in traditional

By Frances Codd Slusa rz, Litigation News Associate Editor

claims like breach of contract, breach

of f‌iduciary duty, and malpractice,”

explains Michael S. LeBo, Newport

Beach, CA, cochair of the Section’s

Professional Liability Committee.

Nevertheless, “allowing third parties

who have been injured by attorney mis-

conduct an avenue for relief, in extreme

circumstances, is a positive thing.”

“Lawyers should not be surprised if a

plainti invokes a violation of the ethics

rules to support a claim against a law-

yer, whether based in common law or

statute,” warns John M. Barkett, Miami,

FL, cochair of the Section’s Ethics &

Professionalism Committee. “The con-

sequences of violating the rules of pro-

fessional conduct may extend beyond a

grievance,” concludes Barkett. “Even if

your client does not come after you, a

third party might,” agrees LeBo.

FALL 2023 • VOL. 4 9 NO. 1

8 | A BA LITIGATION SECTION

ETHICS STRU GGLES IN THE LEGAL WOR LD