The Supreme Court of Texas appoints the chair and the nine members of the Professional Ethics Committee from the bar and the judiciary. According to section 81.092(c) of the Texas Government Code, “Committee opinions are not binding on the Supreme Court.”
Opinion No. 669, March 2018
Under the Texas Disciplinary Rules of Professional Conduct, may a lawyer retained by an insurance company notify the insurance company that the insured client he was assigned to represent is not cooperating in the defense of the client’s lawsuit?
Statement of Facts
Plaintiff sued Defendant in state court for personal injury damages arising out of an automobile accident. Defendant’s insurance company (“Company”) assigned Defendant’s case to a Texas lawyer (“Lawyer”). Lawyer met with Defendant, explained that Company retained him to represent Defendant, explained Defendant’s responsibilities in defending the lawsuit, notified Defendant he would be keeping the Company apprised of the status of the lawsuit, and obtained Defendant’s informed consent to the representation.
Defendant initially cooperated in defending the lawsuit. Later, however, Defendant stopped communicating with Lawyer. Lawyer tried contacting Defendant by various methods. Lawyer eventually hired an investigator, who spoke with Defendant and asked him to contact Lawyer. Defendant did not do so.
Lawyer is concerned about Defendant’s failure to communicate with him, which makes the lawsuit difficult (if not impossible) to defend and may result in the imposition of sanctions for Defendant’s failure to comply with outstanding discovery requests. Lawyer also realizes that Defendant’s failure to communicate may violate the cooperation provision of Defendant’s insurance policy and thus result in Company’s withdrawing coverage.
Lawyer’s investigator delivered a letter to Defendant, informing Defendant that if he did not contact Lawyer, Lawyer would file a motion to withdraw. Lawyer received no response from Defendant. Lawyer therefore plans to withdraw under Rule 10 of the Texas Rules of Civil Procedure. Lawyer is concerned about what he may disclose to Company regarding his reasons for withdrawing.
When a lawyer represents an insured at the request of an insurance company, the attorney and the insured have an attorney-client relationship, and the Texas Disciplinary Rules of Professional Conduct govern the attorney’s conduct. Professional Ethics Committee Opinion 668 (Nov. 2017).
Rule 1.15 of the Rules discusses mandatory and permissive withdrawal from representing a client. Rule 1.15(b) states that permissive withdrawal is not prohibited in a number of circumstances, including these:
“(5) the client fails substantially to fulfill an obligation to the lawyer regarding the lawyer’s services . . . and has been given reasonable warning that the lawyer will withdraw unless the obligation is fulfilled;
(6) the representation . . . has been rendered unreasonably difficult by the client; or
(7) other good cause for withdrawal exists.”
Rule 1.15(b)(5)-(7). Here, Defendant has repeatedly failed to
“fulfill an obligation to the lawyer” by ignoring his obligation to
communicate with and assist Lawyer in responding to discovery, despite
receiving a reasonable warning that Lawyer would withdraw unless the
obligation were fulfilled. Rule 1.15(b)(5). Defendant’s failure to
communicate has also rendered the representation unreasonably difficult.
Rule 1.15(b)(6). Lawyer therefore has grounds to withdraw from
representing Defendant. See In re Daniels, 138 S.W.3d 31, 35
(Tex. App.—San Antonio 2004, orig. proceeding) (ordering the trial court
to grant the motion to withdraw). When Lawyer files the motion to
withdraw, he must comply with all applicable law, including Rule 10 of
the Texas Rules of Civil Procedure.
Although Lawyer plans to file a motion to withdraw from representing Defendant, Lawyer must continue to preserve Defendant’s “confidential information,” which includes both “privileged information” and “unprivileged client information.” Rule 1.05(a). “Unprivileged client information” is “all information relating to a client or furnished by the client, other than privileged information, acquired by the lawyer during the course of or by reason of the representation of the client.” Id. At a minimum, Defendant’s failure to communicate with Lawyer is unprivileged client information.
Rule 1.05(b)(1) and (2) provide that a lawyer shall not knowingly reveal a client’s confidential information to third persons the client has not instructed to receive the information and shall not use a client’s confidential information to the disadvantage of the client unless the client consents after consultation. Because Defendant is not communicating with Lawyer, Lawyer cannot obtain instructions or consent from Defendant.
Rule 1.05 paragraphs (c) to (e) list exceptions to the general rule that a lawyer may not disclose confidential client information to third parties or use it to the disadvantage of the client, but those exceptions are not applicable here. For example, Rule 1.05(d)(1) and 1.05(d)(2)(i) permit disclosing unprivileged client information in order to carry out the representation. The disclosure here, however, would not be for the purpose of carrying out the representation. Thus, Lawyer may not disclose Defendant’s confidential information, including Defendant’s lack of cooperation, to Company, regardless of whether such disclosure may lead to Company’s withdrawing coverage. Moreover, of course, Lawyer may not use Defendant’s lack of cooperation to Defendant’s disadvantage.
Furthermore, Lawyer may not reveal Defendant’s failure to communicate in order to explain to Company the reason for Lawyer’s withdrawal from the representation. With respect to the reasons for withdrawal, a statement to the court and to Company “that professional considerations require termination of the representation ordinarily should be accepted as sufficient.” Rule 1.15 cmt 3. See also ABA Comm. on Ethics and Prof’l Responsibility, Formal Op. 476 (2016) (discussing confidentiality issues when moving to withdraw for nonpayment of fees in civil litigation). Although the Rules prohibit disclosing confidential information, the Rules do not prevent Lawyer from giving notice of the fact of withdrawal. Rule 1.05 cmt 21 (“Neither this Rule nor Rule 1.15 prevents the lawyer from giving notice of the fact of withdrawal . . . .”).
Under the Texas Disciplinary Rules of Professional Conduct, if an insured fails to communicate with a lawyer who is retained to defend the insured, then the lawyer may withdraw from the representation. In that event, the lawyer must protect the insured’s confidential information and may not, in the absence of the insured’s consent, disclose to the insurance company the reason for the withdrawal. In connection with moving to withdraw from the suit, the lawyer should avoid disclosing, either to the court or to the insurance company, the specific reason for the withdrawal. The lawyer instead should provide only a general explanation that professional considerations require withdrawal, although there are circumstances in which a court may require that additional information be provided to the court.TBJ
Opinion No. 670, March 2018
Under the Texas Disciplinary Rules of Professional Conduct, may a lawyer copy and retain client documents when departing a law firm?
Statement of Facts
Just before leaving one law firm for another firm, a lawyer makes electronic and paper copies of client documents regarding matters in which the lawyer personally represented the client. The lawyer takes these copies to his new firm. The lawyer’s former law firm later learns of the copying and retention of its client documents by the lawyer and demands their return from the lawyer and his new firm. The client whose documents were copied is not following the lawyer to the new firm and no continuing representation of the now former client by the lawyer or the new firm is contemplated. The lawyer wants to keep copies of his former client’s documents for use as “forms” in his continuing practice.
Rule 1.05 of the Texas Disciplinary Rules of Professional Conduct requires that a lawyer protect a client’s “confidential information,” as broadly defined in subsection (a) of the Rule. Generally speaking, documents in a client’s file, whether in paper form or stored electronically, belong to the client and are part of the client’s confidential information. See Professional Ethics Committee Opinions 657 (May 2016) and 627 (April 2013). A lawyer’s ability to use or reveal a client’s confidential information is subject to the limited exceptions set out in Rule 1.05. Upon departing a firm, a lawyer who authored or had access to documents during his personal representation of a client may, at the lawyer’s expense, make and retain copies of those documents, subject, however, to important obligations under the Rules.
Subject to the exceptions in Rule 1.05, the departing lawyer is obligated to protect the client’s copied documents from unauthorized disclosure and use for as long as those copied documents exist in any form. The lawyer must not share those client documents with anyone at the new firm who has not also personally represented the same client in the same matter unless expressly authorized by the client or permitted under the provisions of Rule 1.05. For example, paper copies of client documents must be stored in a secure fashion accessible by the departed lawyer only. Similarly, electronic copies must be accessible by the departed lawyer only and not stored in a manner accessible by others within the new firm, absent express client consent.
There are reasons for permitting a lawyer to copy and retain a client’s documents. For example, a lawyer may wish to be able to review a former client’s documents in order to be able to answer questions posed to him after the conclusion of the representation.
A prior law firm’s or former client’s consent is not required for a lawyer to make and retain copies of a client’s documents as long as the lawyer is reasonably responsive to the former client’s requests for copies of documents retained by the lawyer. Although the client’s file belongs to the client, the Rules do not prohibit a lawyer from making and retaining a copy of some or all of a client’s file, at a lawyer’s expense, subject to a lawyer’s obligations under Rule 1.05 to protect the client or former client’s confidential information. See Opinions 657 (May 2016) and 627 (April 2013).
As for using a former client’s documents as a form, a lawyer must delete all of the former client’s confidential information before sharing such forms with anyone who is not authorized by the former client or the Rules to have access to the former client’s confidential information. Furthermore, if a former client’s documents were so customized that any use of them as a form, even after deleting client-specific information, would reveal the former client’s confidential information, then such use would be improper.
Under the Texas Disciplinary Rules of Professional Conduct, a lawyer who leaves a law firm may, at the lawyer’s expense, make and retain copies of former clients’ documents generated in matters in which the lawyer personally represented the clients. The lawyer must, however, comply with his obligation under the Rules to preserve the confidentiality of such documents by preventing the former clients’ confidential information from being improperly used or revealed to others.TBJ
Opinion No. 671, March 2018
May a lawyer, individually or through an agent, anonymously contact an alleged anonymous online defamer in order to obtain jurisdictional information sufficient for obtaining a deposition pursuant to Rule 202 of the Texas Rules of Civil Procedure?
Statement of Facts
A client of a Texas lawyer has been defamed or harassed online by an anonymous party. In preparation for bringing potential claims, the lawyer wishes to conduct a Texas Rule of Civil Procedure 202 deposition but needs to obtain jurisdictional information about the anonymous party first. The lawyer proposes to anonymously contact, or to request that an agent for the lawyer anonymously contact, the party for the purpose of obtaining such information.
The internet has many virtues as a forum for communication, but simultaneously presents certain dangers. Technology can permit an anonymous person to disseminate defamatory statements to millions of readers, ruining reputations and careers with the click of a button. The challenge for a party contemplating a lawsuit is identifying who is behind such postings. Yet for those injured by anonymous online defamation or harassment, the Texas Supreme Court has made it clear that a Texas court cannot order a pre-suit deposition to identify an anonymous online defamer unless the alleged defamer has sufficient contacts with Texas for personal jurisdiction. In re: John Doe a/k/a “Trooper,” 444 S.W.3d 603, 610 (Tex. 2014).
Like Texas, courts in many jurisdictions have sought to balance constitutional protections for anonymous speech and personal jurisdictional requirements with the ability to pursue defamation causes of action. But any proposed solution to the conundrum poses ethical concerns that relate to the propriety of attorneys and their agents anonymously seeking to obtain identifying or jurisdictional information from an anonymous individual.
In general, Rules 4.01(a) and 8.04(a)(3) of the Texas Disciplinary Rules of Professional Conduct address a Texas lawyer’s duty to avoid making material misrepresentations to third parties and engaging in conduct that involves dishonesty, fraud, deceit, or misrepresentation. Rule 4.01 provides in part that, in the course of representing a client, “a lawyer shall not knowingly; (a) make a false statement of material fact or law to a third person….” Rule 8.04(a)(3) provides that a lawyer shall not “engage in conduct involving dishonesty, fraud, deceit, or misrepresentation.” Furthermore, Rule 4.03, which governs dealing with unrepresented persons, provides that a lawyer shall not state or imply that the lawyer is disinterested, and further provides that “[w]hen a lawyer knows or reasonably should know that the unrepresented person misunderstands the lawyer’s role in the matter, the lawyer shall make reasonable efforts to correct the misunderstanding.” Additionally, Rule 5.03 subjects a lawyer to discipline if the lawyer orders, encourages, or permits conduct by an agent that would be in violation of the Rules if engaged in by the lawyer.
Several ethics committees in other states have dealt with the analogous situation of attorneys and their agents contacting individuals via social media for purposes of case investigation or pre-suit information gathering, such as sending a “friend” request on Facebook, requesting to be connected to someone on LinkedIn, or following someone on Instagram or Twitter. The New York City Bar Association Committee on Professional Ethics, for example, has opined that a lawyer shall not “friend” an unrepresented individual using “deception,” and that there is no deception when a lawyer uses his “real name and profile” to send a “friend” request to obtain information from an unrepresented person’s social media account. Ass’n of the Bar of the City of New York Prof’ Ethics Comm., Formal Opinion 2010-2 (2010). That jurisdiction does not require the lawyer to disclose the reason for making the request. Similarly, both the New York State Bar Association Committee on Professional Ethics and the Philadelphia Bar Association Ethics Committee concluded that a lawyer, or someone working under a lawyer’s supervision (such as a paralegal), cannot “friend” a witness under false pretenses. New York State Bar Association Commission on Professional Ethics, Opinion 843 (2010); Philadelphia Bar Association Professional Guidance Committee, Opinion 2009-02 (2009). Both of these bodies relied upon their respective state’s counterparts to Rule 8.04(a)(3). As the Philadelphia Committee observed, failing to tell the witness of the attorney’s identity and role (or the paralegal’s, or investigator’s) “omits a highly material fact, namely, that the third party who [requests] access to the witness’s pages is doing so only because he or she is intent on obtaining information and sharing it with a lawyer for use in a lawsuit to impeach the testimony of the witness.” As the New York City Bar opinion observed, the fact that deception is even easier in the virtual world than in person makes this an issue of heightened concern in the Digital Age.
Other ethics committees have insisted that an attorney engaging in such online investigation must be even more forthcoming. A New Hampshire Bar Association opinion explains that a request to “friend” must “inform the witness of the lawyer’s involvement in the disputed or litigated matter,” and provide disclosure of the “lawyer by name as a lawyer,” and the identification of “the client and the matter in litigation.” N.H. Bar Ass’ n Ethics Committee Advisory Comm. Opinion 2012-13/05. In Massachusetts, it is not permissible for a lawyer to make a “friend” request to a third party in a lawsuit “without disclosing that the requester is the lawyer for a potential plaintiff.” Massachusetts Bar Ass’n Comm. On Prof. Ethics Opinion 2014-5 (2014). A San Diego Bar Association opinion requires disclosure of the lawyer’s “affiliation and the purpose for the request.” San Diego County Bar Ass’n Legal Ethics Comm. Opinion 2011-2 (2011). An Oregon ethics opinion states that if the person being sought out on social media asks for additional information to identify the lawyer, or if the lawyer has some other reason to believe that the person misunderstands his role the “[l]awyer must provide the additional information or withdraw the request.” Oregon State Bar Comm. On Legal Ethics, Formal Opinion 2013-189 (2013).
By analogy, it is the opinion of this Committee that the failure by attorneys and those acting as their agents to reveal their identities when engaging in online investigations, even for the limited purpose of obtaining identifying or jurisdictional information, can constitute misrepresentation, dishonesty, deceit, or the omission of a material fact. Accordingly, lawyers may be subject to discipline under the Rules if they, or their agents, anonymously contact an anonymous online individual in order to obtain jurisdictional or identifying information sufficient for obtaining a Rule 202 deposition. In order to comply with the Rules, attorneys, and agents of attorneys, must identify themselves and their role in the matter in question.
Under the Texas Disciplinary Rules of Professional Conduct, Texas lawyers, and their agents, may not anonymously contact an anonymous online individual in order to obtain jurisdictional or identifying information sufficient for obtaining a deposition pursuant to Rule 202 of the Texas Rules of Civil Procedure.TBJ