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Ethics Opinion

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CI-668

October 12, 1981

SYLLABUS

    There is no ethical prohibition against representing a client against a former employer or client of the lawyer provided business relations have ceased between the lawyer and former client or employer.

    It would be improper to represent a client against the lawyer's former client or employer if the claim involved the same subject matter for which the lawyer was formerly retained or if the lawyer obtained factual information on which to proceed in the present case while retained by the former client or employer.

    A lawyer may not use a confidence or secret of a former client or employer in the criminal defense of a different client without the informed consent of the former client or employer.

    References: DR 4-101.

TEXT

You state that a corporation whose business is to teach students how to pass bar examinations employed you to teach students how to pass bar examinations. You were employed as "Director of Appeals" to teach the corporation's students how to appeal bar examination results. You state you did not purport to and did not act as the corporation's attorney, but functioned only as a teacher to the corporation's students. In early May your employer discharged one of its regional directors on suspicion of embezzlement and filed a criminal complaint. You completed a unit of your teaching in late May.

In July that regional director consulted you, seeking to have your representation in the criminal matter, you then contacted the corporation regarding your involvement in the matter and the corporation promptly terminated its relationship with you. You ask whether it would be permissible ethically for you to represent the former regional director in the criminal matter, and civil actions against the corporation alleging wrongful discharge, malicious prosecution, sexual harassment and/or violation of civil rights, and defamation.

The issue is one of "conflict of interest," so-called, and specifically involves DR 4-101, "Preservation of Confidences and Secrets of a Client."

In the matter of the propriety of your proposed representation in the civil matter, in which you propose to sue the corporation, CI-250 states:

    "There is no ethical prohibition against representing a client against a former employer or client of the lawyer provided business relations have ceased between the lawyer and former client or employer.

    "It would be improper to represent a client against the lawyer's former client or employer if the claim involved the same subject matter for which the lawyer was formerly retained or if the lawyer obtained factual information on which to proceed in the present case while retained by the former client or employer."

The rule was restated as follows in CI-541:

    "C-7 and CI-250 indicate that before a lawyer may bring an action against a former client all business relations must cease, the subject matter of the new representation may not be substantially related to that of the old, and the information upon which the lawyer proceeds must not involve reliance upon confidential communications or secrets imparted to the lawyer by the former client."

This Committee opined in CI-250 that the rule of that opinion applies to protect not only a former client, per se, but also a former employer of the attorney, even though the attorney may not have been employed as an attorney or have established an attorney-client relationship with the employer. The above quoted rules apply in your case whether the attorney-client relationship existed between you and the corporation or not, assuming that an employment relationship existed. The "client" as used in DR 4-101 must be taken to include such an employer.

Assuming that all business relations with the corporation have ceased, and that the subject matter of the contemplated litigation is not substantially related to your previous work for the corporation, the question remains whether in your representation you would proceed on the basis of information imparted to you by the corporation and constituting confidential communications or secrets of the corporation. Put in the language of DR 4-101(B)(2), you may not "use a confidence or secret of [your] client to the disadvantage of the client." That prohibition survives termination of the attorney-client relationship.

Where the subject matters in question are so apparently distinct as in this case, this committee is not prepared to conclude that the proposed representation is per se prohibited. However, you should be aware of the difficulties inherent in such representation. Information that you gained professionally as to the corporation's personnel practices, or accounting practices, or supervision of employees, or its collectibility, could all be or become relevant to the proposed civil litigation. And while you would be prohibited from "using" such knowledge, you would, be unable not to use it without consciously inhibiting the zealousness of your representation, itself a violation of Canon 7. Should you have any such knowledge, or similar knowledge that is or could become relevant, you could not proceed with the representation without either violating your ethical obligations to one or the other client, or both, or putting yourself in a position where, depending on the development of the litigation, you might at any time be caught between the requirements of Canons 4 and 7, necessitating your withdrawal. We therefore conclude that this ethical issue turns on the specific facts and fact issues involved, and must leave you to your own determination in light of the foregoing, which cautioning you as to the difficulties inherent in the proposed course. Any doubts as to whether the proposed representation will result in ethical difficulties should be resolved against undertaking the representation.

Our conclusion is the same as to your representation of the client in the criminal matter. While your use of such knowledge in the new client's behalf might arguably not be to the disadvantage of the corporation, since the people are the adverse party, DR 4-101(B)(3) prohibits its use for the benefit of the new client absent the former client's consent. The same difficulties therefore arise.

We, of course, assume that the corporation does not consent to your new representation and use of its secrets and confidences.

 
     

 

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