16.4. Example: Professional Responsibilities of Law Firm Associates (Douglas Richmond

16. Subordinate / Supervisor

Read rules 5.1 – 5.3 / All students
Ex. 16.4 / Richmond article / All students review; no cold calls
16.5 / Subordinate lawyer hypos / All students review and be prepared to discuss
16.7 / “Breaking Up Is Hard To Do” / All students read and be prepared to discuss

16.4. Example: Professional Responsibilities of Law Firm Associates (Douglas Richmond, Aon Risk Services)

Introduction

MostAmericanlawyers practiceinlaw firms.[1]These firms may beas smallas twolawyers orthey may be verylarge firms with international offices. Althoughlaw firmsare variously structuredandare oftencomprised of severalcategories orclasses oflawyers,thelawyers who practiceinlaw firmscan generally be divided between partnersandassociates. Partners holdequity stakes in their firms, or,inthecase of non-equity partners in multi- tiered partnerships,atleast have some voicein the direction oftheir firmsand inthe management oftheir practices. Regardless,theyare superiortoassociates, whoareat-will employees.[2]Although thereareexceptions,associates tendto be relatively young andinexperienced inthe practice oflaw ascomparedto partners. Partners have the right to direct associates' professionalactivitiesandtoinsist upontheir obediencein work-related matters.[3]Associates must please the partners for whom they workin orderto succeedattheir firms; indeed,they must pleasethose partners simplyto remain employed. Thereis,in short, greatasymmetry betweenassociatesand partnersinterms of experience, knowledge,control over one'stimeand work,and power.

The factthatlaw firm partnersandassociates hold different professional ranksand often operate on different professionallevelsis,in many respects, unremarkable; other professional service firmsalso have distinct hierarchies. Butlawis differentin thatit isa self-regulating profession that vigorously enforcesitsethics rules, and, whileassociates and partners share professional dutiesand problems, in several keyaspects "[t]heethical problems of thelaw firm associate differ from theethical problems of thelaw firm partner."[4]This Article hasits genesis in those differencesandinthecommon perception thatlaw firm associatesareincreasingly pressuredtoact unethically.[5]

This Article'sexamination ofassociates' professional responsibilities begins in Part II witha brieflookatlaw firm culture. Part III discussesassociates inthe professional responsibility framework,concentrating onModel Rule of Professional Conduct 5.2[6]and section 12 of the Restatement (Third) of the Law Governing Lawyers.[7]Part IV discussesassociates' related duties ofcompetence and diligence. PartV examines the duty ofconfidentiality. PartVI discusses overbilling, which isa seriousand recurring issue forassociates, who regularlyarecompensatedand evaluated based on billable hours. Becauseassociates spendconsiderabletime writing, PartVIIlooksatthreerelated professional responsibility issues: disclosingtocourts directlyadverseauthority in thecontrolling jurisdiction, mischaracterizing facts orlegal authority in pleadingsand briefs, and plagiarism. PartVIIIexploresthe dutyto report anotherlawyer's professional misconduct, focusing on the special problems associates face when the lawyertheyare obligatedto reportisa colleagueandespecially when thatlawyerisa partner.Finally, Part IXexaminesassociates' duty ofloyaltytotheir firms.

LawFirm Culture

Itiseasytoidentifyethics rules of particular importancetolaw firm associates. Before doing that, however, we must pay someattentiontolaw firm culture.Every firm's cultureis different,anditis firmculture more thanethics rules or other published professional standardsthat influencesassociates' behavior.[8]

Law firm "culture"is not easily defined.Forlawyers who have never practicedinlaw firms,andcertainly for non-lawyers,law firm cultureis not easily described.Generally speaking,law firmculture "isthe system of beliefs that members shareaboutthe goalsand valuesthat are importanttothemandaboutthe behaviorthatis appropriateto obtainthose goalsandlivethose values."[9]A firm's foundersinitiallycreateitsculture.[10]Over time,a firmestablishesitsculturethrough formal andinformaltraining programs,andthroughlawyers' interaction with othersin the firm.[11]

The factthatlaw firm culture influences associate behavior more thanethics rules will surprise no practicing lawyer.Ethics rulesare generaland sometimes vague, theyestablish only minimum standards ofconduct,andclever lawyerscan skirtthem.[12]Additionally, practicinglawyers makeethical judgments on the fly; professional responsibility problems often presentthemselves whenlawyers perceivethat they have notimetoconsult rules.[13]

Althoughlawyers usually do havetimetoconsultethics rulesand prudentlawyers routinely suppress feelings of urgencytoconsider decisions withethicalimplications,it remainstrue that professional responsibilityis firsta matter of habitandinstinct. If nothingelse,itis instinctthat promptslawyerstoconsultcolleaguesandto seek second opinions before embarking oncourses ofaction with professional responsibility implications.

Most discussions oflaw firmculture focus onlarge firms,[14] perhaps becauselargelaw firms are bureaucracies, andit is widelythought that bureaucracies influence the behaviorandthinking ofthose who workin them. Perhapsit is becauselaw firmsare growing increasinglylarge,[15] or becauselargelaw firmsare perceivedas the domain of thelegalelite.[16]Maybeitis becauselargefirms disproportionatelyinfluencethelegal profession.[17] Regardless,itis wrongtoassume that only large firms have cultures that influence younglawyers.

Thisis first because the description ofa law firmas "large"is imprecise;a fifteen-lawyer firmin Hutchinson, Kansas,islarge forthatcity, but even thelargest firms basedinKansas City, Louisville, orMemphisare unlikelyto beconsideredlargein Chicago orNewYork.Second, small firms havecultures with significant professional responsibilityaspects, both goodand bad.[18]

Unfortunately, examples of unethical culturesinlargelaw firmsabound. Consider two, both drawn fromlarge regionallaw firms thatare prominent in the statesthey serve.[19]

Inthe first example, the firm instituted anincentivecompensation system forassociates linkedto billable hours. Whileassociates were only requiredto bill 1800 hours,they began receiving bonusesat increasing billable hour increments (1950 hours, 2050 hours, and so on).[20] Threehighly-regardedassociatescomplainedtoa respected partner,Edwards,about anotherassociate,Austin.Austin seldomarrivedat the office before 8:30 a.m., rarely stayed past 4:30 p.m.,alwaystook lunch,took vacation, did not work weekends, did nottake work home,and did nottravel much in his practice.Yet,Austin billed over 2200 hours forthe year. This upset the threeassociates,all of whom worked hard but billed nowhere nearthe hoursthat Austin did,andthus received far smaller bonuses. Theassociates werealso offended by the factthat Austin's billing fraud amountedtothe theft of$25,000 fromthe firmin the form ofan unearned bonus,and thetheft of roughly$120,000 fromclients via hours falsely billed. In fact,Austin'sbilling practices were well knownthroughout the firm'sassociate ranks.

EdwardsconfrontedAustininthe presence of Curtis,the firm's managing partner. Curtis wasalsothe partner for whomAustin principally worked. Austinadmittedinflating histime, but arrogantly brushedasideEdwards' concerns, saying thatEdwards should not careabout his fraud solongas theclients paidtheir bills.Afterall,asa partner,Edwards was profiting fromAustin's billingexcess. InAustin's view,the factthat heearneda bonus from the firmto which he was nottrulyentitled, while amountingto theftin theabstract,was unimportant giventhat the firmearned more in fees for hisextratime thanit paid to him by way of bonuses.

Edwardsand Curtis excusedAustin. WhenEdwardstold Curtis that the firm hadtotake actionagainst Austin, Curtis disagreed.Afterall, Curtis saidclientslikedAustin. (They might haveliked himlessif they knew he was stealing from them.) Curtiscontendedthat Austin'sconductcould not constitute fraud becauseclients had not complainedaboutit. (Never mindthat fraud depends on unsuspecting victims.)As fortheeffect ofAustin'sconduct onassociate morale, CurtistoldEdwards that he shouldinformthecomplainingassociatesthat iftheytruly thought the situationto be unfair,they should start billinglike Austin. The firm nevertookanyaction. Tothe contrary, Curtis championedAustin'selectionto partnership within the year.

Inthe secondexample,a law firmexperienceda downturn initscorporate practiceand,asa result, discharged eight juniorassociates.All of them had recently received favorable year-endevaluations. Yet, when explaining the firingstoa reporter fora local business journal, the firm's managing partner,Davis,assertedthatthe firm discharged theassociates for inferior performance. Theterminations were nota product ofa slowdown in businessas the reporter suspected,Davis said, buta manifestation of the firm's needto maintainits high professional standards. Davis's statements were outrightlies andcertainly violatedethics rules prohibiting dishonesty.[21] The statements, when published, surely hurt theassociates, who hadto seek new jobs having been brandedincompetent by their former employerin the press.Davis's statement alsotoldthe remainingassociates muchaboutthe firm'sculture, especially the value the firm placed on honesty.

Ofcourse, the fact thata law firm hasan unethical culture does not meanthat all ofitsassociatesare or will become unethical.Associatesin pervasively unethical firms may havecharacteristics or values that enablethemto resist thecorrosiveeffects of these cultures.[22] They may find mentors who encourageandinspireethical practice,and who foster goodlawyering generally.[23]Moreover,law firm culturescanchange. Culturalchange may beevent driven,as wherea firm pays a significant sumto settlea lawsuitagainstitandthereafter setsabout reforming the practices thatgave risetothelitigation.[24] Keylawyers mayleave, improving culture by subtraction if the departinglawyerscontributedtothe undesirableculture, or forcingthe firmto undergo self-critical analysis if the defectorsare productive andethicallawyers wholeft because of their unhappiness withthe culture. Law firm culturecanalsotransform withchanges in firmleadership.[25]Finally,law firm culturescanchange asa result of conscious decisionsandefforts bytheirlawyers gearedtoward making their firms better places.[26]

Manylaw firms have positiveethical cultures.Forthese firms,theissuesarecultural development and maintenance throughassociate selection, socialization,and interaction. Inotherwords, how dotheyidentify associates who sharetheir values?How dotheycommunicateethical valuestoassociates?How dothey integrate younglawyers into theircultures? These questionscannot be uniformly answered, becauselaw firms do differentthingsin different ways. Beyondthat,associate selectionisa notoriously imprecise process,andthe subject oflaw firm cultureistoo broadand complexto beapproached simply.Nonetheless,itis possible to outline some principles, recognizingthat most associates wantto becomfortable raisingethics issues withcolleagues and want theirlaw firmstocommunicate norms.[27]

First,law firms must encourage day-to-daycontact between partnersandassociates.[28]This may come through formal orinformal mentoring relationships, butit need not be solimited.Forexample, practice groupand departmental meetingsat whichlawyers shareexperiences andcompareapproaches provide valuableteaching opportunities.Second, firms should provide formal in- housetraining forassociates on professional responsibility issues. Training should focus onethical problems thatassociatesarelikelytoencounterandshould spanall stages ofassociates'careers.[29] Third, firms must clearly communicate theirexpectationstoassociates when evaluating them andcandidlyexplain their performance relativetothose expectations.[30]Fourth, firms musttreat associates fairlyin everythingthey do, whetheritiscompensation,evaluation, promotion to partnership, orthe resolution ofpersonalissues.Unfairness breeds dishonesty, disloyalty,and resentment,all of which violate orerode professional values.Fifth, firms must ensurethat associates do not perceiveimportant practice managementtools suchas billable hour models as diminishing the importance of responsiblelawyering.[31]Sixth, whenitcomesto compensation, firms must rewardlawyers whose practices reflect the firm's values, and penalizethose whose practices do not.Seventh, firms of sufficient size shouldappoint generalcounsel orloss prevention partners charged with helpinglawyers practice responsibly.Many firms havealready done this.[32]Finally, when firmsidentify lawyers whose behavior is seriouslyincompatible withthe firm's culture or standards,they must either requirethose lawyersto quickly modify their behavior or severthose relationships.

Naturally, mostlaw firmculturesare neither intolerable norideal froma professional responsibility standpoint, butinsteadfall somewherealonga continuum.For firmsin this vast middle ground,itis notsufficientto simply rely ontheirlawyerstoalways dothe right thing. Lawyers' behavior,likethat ofall people, may beinfluenced by situational variables.Firms must therefore find waystoincorporate professional responsibility intotheir daily practices.Failingto do sois unwise in many respects, notleast because valuable associates who find their firms' culturesto be undesirable will ultimatelyleave. Returningto ourearlierexamples, two of theassociates who complainedabout Austin's behaviorlaterleftthe firm, andDavis's firmhas experienced high associate dissatisfaction and turnover since his public statementsaboutthe layoffs. In short,thethreat of associate turnoverand relatedcosts oughttoinfluence evenethically ambivalent firmsto improve theircultures.[33]

Associates In The Professional ResponsibilityFramework

Theimportance oflaw firm culture should not obscure the importance ofethics rules. TheModel Rules of Professional Conduct,[34] which have beenadoptedinalmost all jurisdictions,addressthe responsibilities of subordinatelawyersin Rule 5.2. That rule provides:

(a)Alawyer is bound by the Rules of Professional Conduct notwithstanding thatthelawyeractedatthe direction ofanother person.

(b)A subordinatelawyer does not violate the Rules of ProfessionalConductif thatlawyeractsinaccordance witha supervisorylawyer's reasonable resolution ofanarguable question of professional duty.[35]

Law firm associatesare subordinatelawyers for Rule 5.2 purposes.[36]

Subordinatelawyers' dutiesarealsoexpressedin section 12 of the Restatement (Third) of the Law GoverningLawyers:

(1)For purposes of professional discipline,a lawyer must conformtothe requirements of anapplicablelawyer codeevenif thelawyeractedatthe direction of anotherlawyer or other person.

(2)For purposes of professional discipline,a lawyer under the directsupervisoryauthority ofanotherlawyer does not violateanapplicablelawyercode byactinginaccordance with the supervisorylawyer's direction based on a reasonable resolution ofan arguable question of professional duty.[37]

Section 12, like Model Rule 5.2(a), applies to law firm associates.[38].

Associates' Duties UnderModel Rule 5.2

Alllawyers,includingassociates,are responsible fortheir own misconduct.[39] Rule 5.2(a) simply makesclear that subordinatelawyers should not deferall decisions involving professional responsibilityissues totheir superiors.[40]Furthermore,Model Rule 5.2(a) statesthata lawyeris bound byapplicableethics rules notwithstanding the fact that sheactedatthe direction ofanother person,ascomparedtoanotherlawyer.[41]Associatestherefore remain accountable fortheiractions whentheyact atthe direction ofa client ora non-lawyer manager, suchasa law firm executive director.

WhileModel Rule 5.2(a)is straightforward,Model Rule 5.2(b) has proven somewhattroublesome. Critics contendthatit provides juniorlawyers witha "Nuremberg" defense.[42] Peopleassertinga Nuremberg defense argue that theirmisconduct should beexcused because they were simply functionaries following superiors' orders.[43]Scholars furthercontend:

[Ethics] rules should inspireeverylawyerto stopandconsiderthe propriety of hisactions. Rule 5.2(b) does justthe opposite. Ittellsthe subordinatelawyer that he may sit backandlet his supervisor makethe decision oncloseethical questions. Because the seniorlawyertakes the responsibility forany misjudgment, the juniorlawyer haslittle incentiveto evenconsidertoughethical issues,letalone raisethem. In sum, Rule 5.2(b) singles out precisely the issues that needethical debate-thearguable questions-and chills that debate.[44]

In fact, Rule 5.2(b) precludesa Nuremberg defense,[45] becauseit protectsa subordinatelawyer only where the question of professional duty isarguable andthe supervisorylawyer's resolution of itis reasonable.[46] The rule affords juniorlawyers no defense incases where the professional duty allegedly breached wasclear.Noristhe rule any help where their professional duty was uncertain buta supervisorylawyerignoredtheissue or resolved the question inan obviously unsatisfactory fashion. Supervisorylawyersare not,ascriticscontend, responsible for "any misjudgment"[47]—only fortheir own.[48] Subordinatelawyers must alwaysconsiderthe propriety of their actions andaddresstoughethicalissues; again, Rule 5.2 does not allowthemtoescape responsibility byclaiming they were just following orders.[49] Itisacceptable forassociatestolettheir superiors decidecloseethical questions becausethose seniorlawyers presumably have more experienceand greater professional knowledge from whichto draw.[50]Finally, Rule 5.2(b) does not chill debate between juniorand seniorlawyers. The rule simply recognizes thatlawyers inlaw firmsand other organizations "must oftenact as one,"[51]andthus permitsa juniorlawyer to defertoa seniorlawyer's reasonable determination of anarguableissue once debateisexhaustedanda decisionmust be made.[52]

Inthe end,it fallstocourtsto determine whethera question of professional responsibility was "arguable" ora supervisorylawyer's resolution ofit was "reasonable." Caselaw suggeststhat associates shouldtakelittlecomfort in Rule 5.2(b).[53]

InIn re Okrassa,[54] forexample,a prosecutor who prosecuteda formerclient from his daysasa public defender wascharged with violating Rule 1.9, which governsconflicts of interest in successive representations.[55]

The prosecutor,Okrassa, had discussedthecase with the County Attorney and hischiefcriminal deputy before takingit, and neither believedthat the situation presenteda problem.[56] The ArizonaSupreme Court rejected Okrassa'sattemptto raisethat consultation asa defenseto discipline, reasoning that "[e]ven minimal research" would have revealedthat his conduct was unethical.[57] Thecourtsuspended him for ninety days.[58]

Thelawyer inPeople v. Casey,[59] William Casey, representeda woman who had given the policean acquaintance's driver'slicense whenarrested.She was processedand jailed under heracquaintance's name, and Casey perpetuatedthat fraud.[60] Caseyconsultedthe senior partnerat hislaw firmabout hisconduct,although the details oftheconversation were never made public.[61] The fraud was exposed,and Casey was charged with several ethics violations.He invoked Rule 5.2(b), claiming that he had beencaughtin an uncertain situation,torn between hisduty ofloyaltyto hisclient and his duty ofcandortothetrialcourt.[62] The ColoradoSupreme Court disagreed, reasoning that Colorado Rule 3.3(b), which requireda lawyerto betruthfultoa court even if doing so meant disclosingconfidentialinformation, "clearly" resolved Casey's "claimed dilemma."[63] Thus,the rule foreclosedtheargument that Casey's dutyto hisclient prevented him from honoring his duty ofcandortothecourt.[64] Thecourt briefly suspended Casey and imposed other sanctions.[65]

InIn re Bowden,[66]theassociate managinga small firm'sSouth Carolina branch office, John Bowden, "learnedit wasthe firm's practicetoinflate government recording fees onHUD-1 settlementstatements."[67]

Bowden's superior,RobertForquer, kept an office inNorth Carolina. When Bowden questionedForquer aboutinflating the fees,Forquerassured him "thatthe practice wasethical andlegal."[68] Bowdenthusallowedthe practice of feeinflationtocontinuein his branch office. Accordingly, theSouth Carolina Supreme Court reprimanded Bowden for violating numerousethics rules, including Rule 5.2.[69]

The practical problem forassociatesis that partners may see no reasonto justify decisions tothem.[70] Partners certainly do not view themselvesas answeringtoassociates.[71] Whatthen shouldanassociate do whena partner instructs hertoactina mannerthattheassociate believesto be unethical?Howis anassociate who raisesa professional responsibility question witha partner supposedto judge whether the question isarguable, or the partner'sresolution ofit reasonable?

As forthe situation in whicha partnerinstructs anassociatetoengageinconduct thatthe associateconsiders unethical, theassociate should first consultanotherassociate whose judgment shetruststo see whether she perceives theissuecorrectly. Theassociate might alsoconsulta partner whom sheconsidersa mentor. Assuming that her colleagues validate herconcern,theassociate should then explaintothe partnerinstructing her why she believes the conductis unethical. Thisconversation should not beaccusatory orconfrontational, since theassociate may nothave sufficient factsto makean informed judgment aboutthe issue orthe partner's reasons forthe original instruction.