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Rule 4.2 and Corporate Representation

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Over the years I have responded to many questions about the interpretation of Rule 4.2 governing communication with a represented party, especially when the represented party is a corporate entity.  Rule 4.2 shields certain “represented” corporate constituents from direct communication about the subject of the representation by opposing counsel.  Based upon questions I have received, there appears to be a misperception that counsel for a corporate defendant in a civil litigation matter can simultaneously represent any current or former constituent (witness) of the corporation “for purposes of the deposition only” to protect that person from informal communications with opposing counsel.    This sort of dual representation, especially where that witness may have damaging information about the corporation, is ill-advised and is likely prohibited by the ethics rules.  Here’s why:

Counsel for a corporation, represents the corporation as an entity.  Rule 1.13.  A lawyer may represent the corporation and any of its individual constituents (employees, members, shareholders, directors) so long as there is no disqualifying conflict of interest.  Rule 1.13(g).  Any dual representation in the same matter, however, requires that the lawyer obtain informed consent from both the organization and the individual to be represented.  Rule 1.7.  Presumably, representation of a corporation and a former constituent would be permissible subject to these same considerations.

A lawyer should not undertake representation of a client when he is aware of a disqualifying conflict of interest under Rule 1.7.  When a lawyer represents a corporate entity, he may only undertake simultaneous representation of a current or former constituent of the organization if representation of one is not adverse to the interests of the other.  For example, if a lawyer knows that a witness (former employee) has information that is adverse to the interests of the corporation, the lawyer should not undertake representation of that witness in the same matter.  Once a lawyer has agreed to represent the client/witness, the lawyer owes that client a duty of loyalty which stretches throughout the matter he is handling.

Even if a lawyer could ethically limit the representation of the former employee to a deposition, if the former employee/witness provides information in the deposition that is inconsistent with the corporate client’s narrative or position, or adverse to the interests of the corporation in the matter, the corporate lawyer has a disqualifying conflict of interest at that very moment. The attempt to limit the representation to the deposition would be ineffective in preventing a conflict of interest. The lawyer cannot fulfill his duty of loyalty to both clients. Furthermore, if the deposition testimony could be used by the opposing counsel at hearing, or if the witness would be called to the stand during trial, the corporate lawyer’s duty of loyalty to the corporation may require cross examination of the witness/client.  At the same time, the duty of loyalty owed to the former employee in this matter would preclude such action.

This dual representation would also raise the question whether the lawyer, in representing the former employee/witness in the deposition, was protecting the interests of the deponent or his corporate client when instructing the witness when to respond or in raising objections. A lawyer who advises a deponent/witness not to give relevant information that is subject to disclosure under applicable law or rules of evidence engages in professional misconduct under Rule 3.4 (d) and is acting adverse to the interests of the deponent. The lawyer seeking information from the deponent may bring a motion to compel, and if that motion is successful, the deponent may be ordered to pay costs/attorney’s fees for the motion. Any direction to the deponent not to provide relevant, discoverable evidence is an action against the interests of the deponent, and a conflict of interest.  Furthermore, the lawyer has an obligation to follow procedural and evidentiary rules, and not unlawfully obstruct access to evidence.  Rule 3.4.

If the former employee has any information that could be prejudicial to the corporation or helpful to the opposing party, a lawyer cannot undertake representation of this individual to try to shield this information from disclosure at deposition.  If a lawyer tried to undertake representation of both the individual and the corporate client under these circumstances, this disqualifying conflict of interest would require the lawyer to withdraw from representation of both the corporation and the former employee. So, before a lawyer may undertake joint representation of a corporate defendant and a former employee, he must do his due diligence to determine that a conflict of interest is not likely to arise, and that he can represent the best interests of the former employee at all times in the deposition and at trial, if necessary.  If he cannot do so, he must not offer to represent the former employee. Rule 1.7(a)(2).

ABOUT Deanna S. Brocker Deanna represents attorneys before the State Bar on grievance and disciplinary matters and also counsels attorneys and law firms on various ethics matters. She previously served as Assistant Ethics Counsel to the NC State Bar for over 10 years. To read Deanna's full bio, click here