Ethics for the In-House Paralegal A Look at Real-World Challenges

Transcription

1 Ethics for the In-House Paralegal A Look at Real-World Challenges Paul Howard, Arnold & Porter Kaye Scholer Bonnie Lenox, Harbor Group International, LLC Christiane Lourenco, Alion Science and Technology Corporation 2017 Paralegal Institute June 20, 2017 apks.com Arnold & Porter Kaye Scholer LLP All Rights Reserved.

2 Contact Information Paul A. Howard Bonnie C. Lenox Christiane Lourenco

3 Agenda Introduction Ethical Responsibilities/Model Rules ABA Guidelines Key Ethical Issues Unauthorized Practice of Law Conflicts of Interest Confidentiality Scenarios/Exercises 3

4 Introduction Attorneys are required to comply with their jurisdiction s applicable rules for professional conduct, which govern an attorney s numerous responsibilities to clients, the court, the public, and the legal profession generally Under those rules, a paralegal s professional actions are ultimately the attorney s responsibility, and the attorney must ensure that a paralegal s conduct is consistent with the attorney s ethical obligations 4

5 Rules of Professional Conduct Every state (and D.C.) have adopted their own rules of professional conduct that attorneys practicing in that jurisdiction must follow For our purposes today, we will use the American Bar Association s Model Rules of Professional Conduct Be Aware: your own jurisdiction may have rules that differ somewhat from the Model Rules 5

6 Paralegal Services In addition to the Model Rules, the ABA has also adopted Model Guidelines specifically on the utilization of paralegal services We will use these Model Guidelines today Once again, be aware that your state/jurisdiction may have adopted its own guidelines, which may differ somewhat from the ABA Model Guidelines Other Sources: NALA Code of Ethics and Professional Responsibility NFPA Model Code of Ethics and Professional Responsibility 6

7 Key Ethical Issues for Paralegals Today, we will be looking at three areas where paralegals can find themselves confronted with ethical concerns: Unauthorized Practice of Law Conflicts of Interest Confidentiality These are by no means the only ethical considerations relevant to paralegals Never be shy about asking a supervising attorney if you have an ethics question 7

8 Unauthorized Practice of Law In general, no one may practice law in a jurisdiction where they are not admitted to do so Model Code Rule 5.5 governs this, and can be read in its entirety here What constitutes the practice of law is a fact-specific question, and may differ from state to state Example: real estate closings. Florida specifically permits paralegals to perform unsupervised, while Georgia specifically prohibits it 8

9 Unauthorized Practice of Law (cont.) For paralegals, the principal question is whether or not they are supervised by an attorney who maintains responsibility for the work product ABA Model Guideline 2 PROVIDED THE LAWYER MAINTAINS RESPONSIBILITY FOR THE WORK PRODUCT, A LAWYER MAY DELEGATE TO A PARALEGAL ANY TASK NORMALLY PERFORMED BY THE LAWYER EXCEPT THOSE TASKS PROSCRIBED TO A NONLAWYER BY STATUTE, COURT RULE, ADMINISTRATIVE RULE OR REGULATION, CONTROLLING AUTHORITY, THE APPLICABLE RULE OF PROFESSIONAL CONDUCT OF THE JURISDICTION IN WHICH THE LAWYER PRACTICES, OR THESE GUIDELINES. 9

10 Unauthorized Practice of Law (cont.) Non-Delegable Legal Tasks: Some obvious, some not so much, some mostly irrelevant to in-house paralegals A Paralegal May Not: Appear before a court or other tribunal/body Give legal advice/opinions to a client Conduct depositions Establish an attorney-client relationship Establish the amount of a fee to be charged for legal services Other scenarios may vary by state 10

11 Unauthorized Practice of Law (cont.) Even with the non-delegable tasks, though, paralegals may assist the attorney in preparing/performing Potential Dilemma: establishing trust and confidence of your supervisors versus staying in your lane Supervision and Attorney Responsibility are the Key Don t Be Shy: Ask your attorney supervisor if you think there is any question about the propriety of your performing certain tasks 11

12 Conflicts of Interest ABA Model Guideline 7 A LAWYER SHOULD TAKE REASONABLE MEASURES TO PREVENT CONFLICTS OF INTEREST RESULTING FROM A PARALEGAL S OTHER EMPLOYMENT OR INTERESTS. NALA Canon 8 A PARALEGAL MUST DISCLOSE TO HIS OR HER EMPLOYER OR PROSPECTIVE EMPLOYER ANY PRE-EXISTING CLIENT OR PERSONAL RELATIONSHIP THAT MAY CONFLICT WITH THE INTERESTS OF THE EMPLOYER OR PROSPECTIVE EMPLOYER AND/OR THEIR CLIENTS. NFPA EC-1.6 A PARALEGAL SHALL AVOID CONFLICTS OF INTEREST AND SHALL DISCLOSE ANY POSSIBLE CONFLICT TO THE EMPLOYER OR CLIENT, AS WELL AS TO THE PROSPECTIVE EMPLOYERS OR CLIENTS. 12

13 General Applicability Prior (or Concurrent) Employment Personal Relationships Financial Interests Outside Activities or Businesses Responsibility at The Time of Hire Disclose any interest that could result in a conflict or appearance of one Ongoing Responsibilities Ethical Screens Conflicts of Interest (cont.) 13

14 Conflicts of Interest (cont.) Organization as client Model Rule 1.13 Never assume officer s interests align perfectly with organization s 14

15 Confidentiality ABA Model Guideline 6 A LAWYER IS RESPONSIBLE FOR TAKING REASONABLE MEASURES TO ENSURE THAT ALL CLIENT CONFIDENCES ARE PRESERVED BY A PARALEGAL. NALA Canon 7 A PARALEGAL MUST PROTECT THE CONFIDENCES OF A CLIENT AND MUST NOT VIOLATE ANY RULE OR STATUTE NOW IN EFFECT OR HEREAFTER ENACTED CONTROLLING THE DOCTRINE OF PRIVILEGED COMMUNICATIONS BETWEEN A CLIENT AND AN ATTORNEY. NFPA EC-1.5 A PARALEGAL SHALL PRESERVE ALL CONFIDENTIAL INFORMATION PROVIDED BY THE CLIENT OR ACQUIRED FROM OTHER SOURCES BEFORE, DURING, AND AFTER THE COURSE OF THE PROFESSIONAL RELATIONSHIP. 15

16 Confidentiality (cont.) Confidentiality is a fundamental principle in the attorney-client relationship It is a lawyer s responsibility to instruct paralegals clearly on the need to preserve client confidences Confidentiality applies to all information relating to the representation not just matters communicated in confidence Be Smart: Silence is Golden 16

17 Confidentiality (cont.) For the in-house paralegal, remember the organization is the client Sharing information outside the organization is almost always unwise. Some exceptions: Outside counsel, if within the scope of their representation of your organization Other third party service providers in limited circumstances Sharing information within the organization usually fine, but not always: Internal ethics investigations Always ask supervising attorney if there is any question 17

18 Scenario #1 General Counsel trusts you and relies on your work to ease her burden You routinely prepare approval memos for your company s state-level political contributions; the GC always sends them to the CFO as is she has never once changed a word GC is out of the office; CFO asks you for immediate approval of a contribution, as the fundraiser is that night You cannot reach GC How do you answer the CFO? 18

19 Scenario #2 You used to work for a company that is a competitor You became acquainted with business expansion plans by competitor and other trade secrets What do you disclose when applying for position? Ongoing Obligations? 19

20 Scenario #3 Your parent works for a law firm representing a variety of clients One of your parent s clients sues your organization Your parent is actively involved with suit What do you do? 20

21 Scenario #4 Stressful period for you Involved in an internal investigation relating to wrongdoing in your company Potential illegality could result in headlines and criminal investigations Stock price likely to be impacted Your spouse notices your mood and asks tell me about your day 21

22 Scenario #5 Same scenario COO of company is a target of investigation COO s executive assistant is a friendly colleague who started work on the same day you did; you went through orientation together EA not a target of investigation and not suspected of any involvement in wrongdoing EA visits your office to ask, should I be looking for a job? 22

23 Questions & Discussion 23

24 Speaker Biographies Paul A. Howard (Associate, Arnold & Porter Kaye Scholer) focuses his practice on a variety of federal legislative and public policy issues, with an emphasis on those relating to insurance regulation, counseling clients on legislative procedure, strategy, and coalition-building. Mr. Howard also counsels clients on federal, state and local lobbying requirements, as well as campaign finance and election law compliance. His practice also includes advising both foreign and domestic clients on compliance with US financial sanctions on Iran, Cuba, and other countries. Bonnie C. Lenox (Legal Department Administrator, Harbor Group International, LLC) Since 1985, Ms. Lenox has had a career as a paralegal involved in asset based lending, securities trading, bankruptcy and complex reorganizations. Her duties within Harbor Group s legal department include managing portfolio entities, creating and maintaining transactional documents, litigation management and support, electronic record keeping, and overseeing compliance administration for two registered investment advisors. Christiane Lourenco (Senior Paralegal, Alion Science and Technology Corporation) has over 20 years of experience as a paralegal with 14 years involved in complex mergers and acquisitions, financial transactions and reorganizations. Her duties within Alion s legal department include maintaining corporate minute books and corporate governance matters, litigation management and support, intellectual property management and support, creating and maintaining transactional documents, and overseeing ethics compliance program administration. 24