I. Introduction

LibraryProfessional Responsibility in Litigation (ABA) (2016 Ed.)

I. Introduction

Lawyers routinely negotiate on clients' behalf. Ninety-five percent or more of all civil litigation settles. Those settlements are typically the product of negotiations between the parties' lawyers, whether conducted directly or facilitated by third-party neutrals. Countless disputes are resolved through negotiation before suit is ever filed. With respect to criminal litigation, more than 90 percent of all federal and state criminal cases are resolved through guilty pleas. Those pleas often derive from negotiations between prosecutors and defense lawyers.

Despite the fact that most lawyers negotiate in their practices, many are unaware of their related professional responsibilities and liabilities, especially with respect to truthfulness. There are several possible reasons for this confusion.

First, the negotiation process varies by place and subject, and thus calls either for different rules in different contexts or for rules stated only at a very high level of generality.

Second, negotiation is paradoxical in the sense that lawyers must be honest even as they are attempting to mislead or distract their adversaries. Like poker players, negotiating lawyers often must hope that opponents miscalculate the strength of their hands and, indeed, must facilitate their opponents' inaccurate assessments.

Third, and consistent with the second point, most lawyers understand that some dissembling and misdirection is expected in negotiation. As a result, ethics rules relating to honesty are easily discounted or disregarded.

Fourth, lawyers are naturally influenced by personal beliefs, opinions, and perceptions about lawyers' roles in negotiations in general, and theirs in particular. Trouble potentially lurks if lawyers' personal frameworks accommodate only partisan views of issues, treat negotiation as a zero-sum game, or place the lawyer's desires or interests ahead of the client's.

At the same time, professional responsibility scholars may not appreciate or recognize the need to accommodate some deception in negotiations. Recall, for example, the controversy over Bank of America's acquisition of Merrill Lynch & Co. in 2008. A lawyer for the Bank argued to lawyers for the Federal Reserve that a material adverse change (MAC) in Merrill Lynch's financial condition entitled the Bank to invoke an escape clause in the parties' merger agreement. The Bank used the threat of a MAC to extract more bailout money from the government. It was later revealed that the same lawyer had confidentially counseled the Bank against invoking the escape clause because, in his informed judgment, a court would be unlikely to find a MAC that would permit the Bank to terminate the merger. Some prominent law...

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