LEO: Confidentiality - Multiple  LE Op. 1194

 

Confidentiality - Multiple Representation: Representing a Client in

an Adverse Action to a Former Client.

 

February 16, 1989

 

You have advised that you have represented franchisees from the inception

of their operation, approximately three years ago. Approximately eighteen

months after the inception of their operation, you represented the same

franchisees in their dispute with the franchisor, and that dispute was

resolved with a secret settlement of a substantial monetary payment to the

franchisees. Subsequent to that situation you performed computer based

research for the franchisor, after having obtained the consent of the

franchisee, which research consisted of information and assessment of the

strategy and tactics of a Boston lawyer who was preparing a class action

on behalf of numerous franchisees. You indicate that you obtained no

information relative to the franchisor during the course of your

preparation of the research. A new dispute has arisen between the

franchisees and the franchisor, and you wish to know whether you may

proceed to represent the franchisees against the franchisor.

 

The Committee directs your attention to LE Op. 441 and DR:5-105(C)

and (D) in which the Committee opined that the mere fact that a lawyer has

formerly represented a person who is now the adverse party in a suit

brought by the lawyer on behalf of another client is not sufficient to

warrant disqualification of the lawyer on ethical grounds. However, a

violation of DR:4-101(B) may result if the lawyer possessed confidential

information which he obtained from his first client. (See also LE Op.

672 and LE Op. 792)

 

The Committee would opine that even though an attorney-client

relationship may have in fact existed between the attorney and the

franchisor, if it is determined that the current dispute is not

substantially related or materially adverse in any respect to a prior

representation and the attorney did not gain secrets or confidential

information concerning the franchisor, the continued representation of the

franchisee in the current dispute would be ethically permissible.

 

Committee Opinion February 16, 1989