United States: Solving Conflicts Of Interest Of Nonattorney Staff

The hiring of nonattorney staff such as a paralegal can implicate some similar ethics issues as hiring a lateral attorney. For example, a paralegal often has in their possession confidential information relating to those matters on which the paralegal provides professional services. When that paralegal moves to a new law firm, the paralegal's prior work on other matters could create conflicts of interest for the new law firm.

Not all law firms treat these issues with the seriousness they may deserve. The consequences of such omissions can be serious, but they are avoidable. The Supreme Court of Georgia provided guidance for law firms in navigating these issues to avoid a disqualifying imputed conflict of interest in its decision in Hodge v. Urfa-Sexton, LP, 295 Ga. 136 (2014).

In Hodge, a law firm hired a paralegal who had worked previously at a different law firm that was litigating a claim against one of the hiring law firm's clients. Neither the former law firm nor the paralegal disclosed any possible conflict to the hiring law firm relating to that matter. Thus, no screening procedures were implemented upon the paralegal's hiring at the new firm.

After the paralegal began working at the hiring firm, she learned that the hiring firm worked on the same matter in which her former firm was also involved, and she disclosed it internally. Immediately upon learning of the potential conflict, the hiring law firm implemented ethics screens to protect against the disclosure of any confidential information the paralegal had learned at the former law firm. Approximately two months later, the hiring law firm notified the former law firm of the potential conflict. The former firm filed a motion to disqualify the hiring firm from the case.

The majority of states that have addressed this issue have found that appropriate ethics screens may avoid an imputed conflict of interest. The state Supreme Court followed suit and held that the screening of nonattorney staff "is a permissible method to protect confidences held by nonlawyer employees who change employment." The court explained that a nonattorney's conflict of interest may be remedied, if the law firm employing that nonattorney uses effective and appropriate screening measures and promptly discloses the conflict.

This decision helps provide a framework for law firms to avoid a disqualifying imputed conflict of interest based on the hiring of nonattorney staff. Here are the steps:

Consider Conflicts During the Hiring Process

It is generally easiest to identify potential conflicts of interest prior to the actual hiring of nonattorney staff. Many firms will choose to use a written application that inquires about the candidate's prior legal employment, relationships with attorneys and legal experience. The hiring firm can then take that list of law firms or attorneys and run through the firm's conflict system just as they would for a lateral attorney hire. If the conflicts system reveals that the prospective nonattorney staff hire has worked for, has experience with or is related to counsel involved with matters involving clients of the firm, then the hiring firm can conduct further inquiry.

The court in Hodge agreed that "it would be prudent for a potential employer to conduct a conflict check before hiring a new nonlawyer, so as to implement appropriate screening measures and avoid the possibility of subsequent disqualification." For many, this screening process is purely prophylactic and involves no additional action. However, if the application and follow-up reveals a potential problem, most firms will take additional steps to assess whether there is a risk of disqualification.

Is it Time To Provide Notice?

The court in Hodge seemed to have some concerns regarding the timing of the law firm's steps. Although the hiring law firm implemented screening procedures immediately, it delayed notice to the former law firm.

Upon learning of a potential conflict, even involving nonattorney staff, firms in this situation may consider giving prompt notice in writing and describe in detail the conflict and the screening measures that have been or will be implemented upon hiring.

What is Adequate Screening?

In Hodge, the Georgia Supreme Court found that the hiring law firm "implemented effective screening measures as soon as" it learned of the conflict to ensure that the paralegal "would not disclose confidential information" and had "not actually disclosed such confidential information." Because the court approved of the screening techniques adopted by the hiring firm in Hodge, they can be instructive for law firms reviewing how to establish an effective screen.

To avoid a potential conflict in the case, the hiring law firm in Hodge:

  • Instructed the paralegal not to be involved in the case in any way or to have any discussions with anyone about the case or their knowledge about it;
  • Restricted access to the electronic file and notified the paralegal that appropriate screening measures would be implemented at the law firm to prevent such access;
  • Implemented and confirmed electronic screening measures including steps restricting the paralegal's access to any information about the case, implementing security measures to prevent the paralegal from accessing any computerized information maintained by the law firm and testing the security measures to ensure their success;
  • Removed the physical file from the general file room and securely placed it in the office of an associate; and
  • Confirmed that the security measures would remain in place for the duration of the case.

Effective screening techniques are generally aimed at protecting the disclosure of confidential information, either from the screened employee to the firm or from the firm to the screened employee. These techniques can help law firms balance their goals for hiring new talent to help them serve clients with the risks inherent in potentially imputed conflicts.

Dentons is the world's first polycentric global law firm. A top 20 firm on the Acritas 2015 Global Elite Brand Index, the Firm is committed to challenging the status quo in delivering consistent and uncompromising quality and value in new and inventive ways. Driven to provide clients a competitive edge, and connected to the communities where its clients want to do business, Dentons knows that understanding local cultures is crucial to successfully completing a deal, resolving a dispute or solving a business challenge. Now the world's largest law firm, Dentons' global team builds agile, tailored solutions to meet the local, national and global needs of private and public clients of any size in more than 125 locations serving 50-plus countries. www.dentons.com.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Events from this Firm
30 Jan 2019, Other, Chicago, United States

Please join us on January 30, 2019, for the Fifth Annual Courageous Counsel Leadership Institute. This year's theme is "Risk and reward: Creating a culture that promotes innovation, change and growth.

 
In association with
Related Topics
 
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions