Can the same lawyers represent two separate plaintiff classes in different suits against the same defendants without a conflict of interest?

Plain-English summary

Lawyers represented a class of Alabama pharmacy owners in an antitrust suit against pharmaceutical manufacturers and had also moved to intervene on behalf of a class of indirect purchasers (consumers) in a second suit against the same manufacturers. Opposing counsel in the second case argued the lawyers had a conflict of interest. The lawyers asked the Disciplinary Commission for an expedited opinion.

The Commission concluded there was no present conflict of interest under the circumstances described. It analyzed the question under Rule 1.7(b), which bars a representation that may be "materially limited" by the lawyer's responsibilities to another client unless the lawyer reasonably believes the representation will not be adversely affected and the clients consent after consultation. The opinion explained that ordinarily a lawyer may not represent two plaintiffs in separate actions against the same defendant if the lawyer knows or has reason to believe there will be insufficient insurance or assets to satisfy both potential claims, but that consent after full disclosure obviates that conflict.

Here the opinion found no issue conflicts between the two plaintiff classes: the pharmacy owners and the consumer purchasers both contended the defendants took illegal steps to inflate drug prices, and there was no indication the defendants' resources were so limited as to create competition for the same assets. The opinion cautioned that if future discovery revealed that situation, the conflict issue would have to be addressed again, and noted that Rule 1.7(b) gave the lawyers the option of seeking consent from their class clients, which would eliminate the risk of any adverse effect from the multiple representation.

Currency note

This opinion was issued in 1996, before the 2002 Ethics 2000 revisions to the ABA Model Rules of Professional Conduct and Alabama's subsequent amendments to its Rules of Professional Conduct. Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule, deadline, or requirement mentioned here.

Common questions

Q: Is it a conflict to represent two plaintiff classes in separate suits against the same defendant?

A: Not automatically. The opinion concluded there was no present conflict where the two classes were not competing for a limited recovery and their interests were not adverse.

Q: When does representing two plaintiffs against one defendant become a conflict?

A: The opinion stated that ordinarily a lawyer may not represent two plaintiffs in separate actions against the same defendant if the lawyer knows or has reason to believe there will be insufficient insurance or assets to satisfy both claims, unless both plaintiffs consent after full disclosure.

Q: What if the defendants' assets later turn out to be limited?

A: The opinion said that if future discovery revealed the defendants' resources were too limited to satisfy both claims, the conflict issue would have to be addressed again, and the lawyers could seek consent from their class clients to eliminate the risk.

Background and rules framework

The opinion interprets Rule 1.7(b) of the Alabama Rules of Professional Conduct (Model Rule 1.7), the general conflict rule, as applied to a lawyer representing two plaintiff classes against common defendants. The key factor the opinion identifies is whether the two representations compete for a limited fund; absent that competition and any adversity of interest, no present conflict exists, and client consent after consultation remains available as a cure if circumstances change.

Citations and references

Rules of Professional Conduct:

• Model Rule 1.7 / Ala. R. Prof. C. 1.7(b) (conflict of interest; material limitation; consent after consultation)

Statutes:

• Ala. Code 1975, § 6-5-60 (Alabama antitrust statute, referenced in the request)

See also

• AL Ethics Op. 1996-06: Hiring an Adversary Firm
• AL Ethics Op. 1991-08: Conflicting Present Clients
• RI EAP Op. 2006-01: Representing a Passenger's Underinsured Claim Against an Insurer Is Not Adverse to Representing the Insured Driver in an Unrelated Slip-and-Fall Case
• RI EAP Op. 2007-08: Representing a Terminated Agency Hearing Officer and Concurrently a Licensee Before the Same Agency Is Not a Rule 1.7 Conflict Absent Adversity

Source

• Landing page: https://www.alabar.org/office-of-general-counsel/formal-opinions/1996-03/
• Original PDF: https://www.alabar.org/assets/2019/02/1996-03-1.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Party names were redacted in the source and may appear garbled; minor errors may remain. The linked PDF is authoritative.

ETHICS OPINION

RO-96-03

QUESTION:

"This letter constitutes a request for an expedited opinion with respect to the question of whether or not I and other lawyers have a conflict of interest arising out of our participation in two separate lawsuits. In the Circuit Court of [redacted] County, Alabama, in a case styled [first case], we represent a class of pharmacy owners in a lawsuit filed pursuant to Alabama's antitrust statute, § 6-5-60 Alabama Code 1975, against numerous pharmaceutical manufacturers. In [the first case] we allege that the pharmaceutical manufacturers have conspired in a price discrimination scheme to charge favored purchasers of pharmaceuticals lower than market rates while the same defendants charge the owners of independent pharmacies artificially and agreed upon high rates.

Other lawyers and I have also recently filed a petition to intervene and a complaint in intervention in [the second case], civil action pending in the Circuit Court of [redacted] County, Alabama. In the [second] case a class of indirect purchasers or consumers has been certified as a class composed of Alabama residents as well as residents of the District of Columbia and the States of Kansas, Maine, Michigan, Minnesota, Mississippi, New Mexico and Wisconsin. In [the first case] no class certification has yet been entered.

In the [second] case the lawyers for the original plaintiff and plaintiff class oppose our intervention on the grounds that we have a conflict of interest. We believe that no conflict exists for the following reasons:

1. The defendants are the largest pharmaceutical manufacturers in the world. Between them they have more assets and a greater wealth than most of the countries of Europe combined. This is not a situation where there is a limited fund for recovery. The two classes may be competing for the same funds but the funds are unlimited. As you can see from the attached complaint and motion for class certification and order in the [second] case, individual claims of $50,000 or more are excluded by definition from the class. There is simply no possibility that these two classes, that is the class in [the first case] and [the second case], will ever be competing for a limited pool of money.

2. Under Alabama's antitrust statutory scheme the damages sought in both cases are statutory and therefore are defined or fixed by statute. It is not a situation where unlimited damages would be sought by competing classes.

3. The wrongful conduct complained of in both actions is the concerted effort by the defendants to fix the prices of drugs charged to retail pharmacies and to the customers of those pharmacies. There is no allegation in either case that the retail pharmacies have violated Alabama law. The wrongful conduct complained of in both cases is that of the defendants. This wrongful conduct has affected both classes of plaintiffs. The fact that the pharmacies may in some instances have passed on the artificially inflated prices to the indirect purchasers or the consumers is not a violation of Alabama law and is not the subject of either complaint. With respect to the liability of the defendants, then, the necessary proof is identical in these cases. Accordingly we could have no conflict if that is the complaint of the plaintiffs' lawyers in [the second case].

Any claim by the plaintiffs' lawyers in the [second] case that we have a conflict of interest due to our representation of the plaintiffs' class in [the first case] could only be raised after there had been a certification of the plaintiffs' class in [the first case]. No certification has been made. Even if we admitted the possibility of such a conflict, it could not conceivably arise until there was a certification in [the first case].

We do not believe that we have a conflict of interest between these two plaintiff classes. The judge in the [second] case will be deciding sometime in the near future whether we have a conflict or not. We would like as prompt a ruling as we possibly can get from your office as to whether or not any conflict exists."

ANSWER:

You do not presently have a conflict of interest under the circumstances described in your letter.

DISCUSSION:

This situation is covered by Rule 1.7(b), which states:

"Rule 1.7 Conflict of Interest
General Rule

(b) A lawyer shall not represent a client if the representation of that client may be materially limited by the lawyer's responsibilities to another client or to a third person, or by the lawyer's own interests, unless:

(1) The lawyer reasonably believes the representation will not be adversely affected; and

(2) The client consents after consultation. When representation of multiple clients in a single matter is undertaken, the consultation shall include explanation of the implications of the common representation and the advantages and risks involved."

Ordinarily a lawyer may not represent two plaintiffs in separate actions against the same defendant if the lawyer knows or has reason to believe there will be insufficient insurance or assets to satisfy both potential claims. However, if both plaintiffs consent to the representation after full disclosure then the conflict is obviated.

In the circumstances you have described, there do not appear to be any issue conflicts between the two plaintiff classes you seek to represent. In [the first case], you represent Alabama pharmacy owners and in [the second case], you will be representing consumers who have purchased drugs in the past. Both groups contend that the defendant took illegal steps and measures to inflate the prices of their products to those in the distribution and end-user positions. As for whether both plaintiff classes will be competing for the same assets to satisfy their claims, there is no indication, at this point, that the defendants' resources are so limited as to generate that type of conflict for you. If future discovery reveals that situation, then the conflict issue would have to be addressed again. Rule 1.7(b), of course, gives you the option of seeking consent from your class clients. In that case the risk of any adverse effect created by the multiple representation is eliminated.

MLM/vf

3/13/96