Screen Test
It is not just attorneys who can trigger issues of confidentiality and conflicts of interest when they move from one law firm to another.
The same types of concerns can arise when paralegals and other nonlawyer employees switch firms.
Like attorneys, these employees may have access to confidential information about cases and clients their firm is handling. And that information could be used by their new firm if it handles a case that is adverse to the interests of any former clients who were represented by the firm where the nonlawyer previously worked.
Rule 1.9 of the ABA Model Rules of Professional Conduct prohibits a lawyer who joins a new firm from representing clients with interests adverse to a former client if the conflict arises “in the same or a substantially related matter” and confidential information acquired by the lawyer about the former client is material to the case. (The former client may consent to waiving this prohibition.)
Generally, one lawyer’s disqualification will be imputed to the other members of the firm unless the lawyer can be “screened” from any involvement in the case. While the ABA Model Rules do not provide for screening, the professional conduct rules in many states do.
While nonlawyer employees are not governed by the ethics rules, many jurisdictions hold them to the same standards as lawyers when it comes to confidentiality issues.
Some jurisdictions prohibit screening as a way for a firm to avoid disqualification from a case regardless of whether a lawyer or a nonlawyer employee is the source of the conflict. See Zimmerman v. Mahaska Bottling Co., 19 P.3d 784 (Kan. 2001).
Most jurisdictions, however, permit nonlawyer screening in some instances. The Nevada Supreme Court recently joined that majority in Leibowitz v. Eighth Judicial District Court of the State of Nevada, 78 P.3d 515 (2003).
In Leibowitz, the court rejected the notion that a nonlawyer employee’s mere access to client confidences at a prior firm warrants disqualification for the new firm. The court held that the new firm is tainted only when the nonlawyer has actually acquired confidential information in previous employment about a client who is now an adverse party.
The court also ruled that “additional considerations” warrant screening for nonlawyers even though Nevada does not permit screening of lawyers who change firms.
AN AFFIRMATIVE DUTY
A firm hiring a nonlawyer has an affirmative duty to determine whether the new employee previously had access to adversarial client files, the court stated. If so, the firm must screen the employee regardless of whether he or she had any actual knowledge of confidential or otherwise privileged information.
The court also said the firm must inform the adversarial party or its counsel about the nonlawyer’s hiring, and the screening mechanisms used. An adversarial party may agree to the use of the screening mechanisms, agree to waive screening or file a motion to disqualify the nonlawyer’s new firm.
Even when a firm uses screening, disqualification is required, absent a waiver, if the nonlawyer has disclosed the former client’s confidences to the new firm, the court stated in Leibowitz. The court also said the employee’s new firm should be disqualified if screening would be ineffective or the nonlawyer would be required to work on the other side of the same or a substantially related matter.
The effectiveness of screening should be determined by several factors, the court stated, including how closely related the two matters are, how much time has elapsed between them, the size of the firm, the number of individuals presumed to have confidential information, the nature of their involvement in the former matter, and elements of the firm’s screening measures.
The overall effect of the Nevada Supreme Court’s ruling in Leibowitz is that, while averting disqualification may in some cases be beyond a firm’s control, screening nonlawyers can help minimize that possibility.
Kathleen Maher, a lawyer, is with the ABA Center for Professional Responsibility.
