When a lawyer represents an organization in a dispute, does the lawyer also represent the organization's officers and employees, and what must the lawyer tell them?

Plain-English summary

Opinion 120 (adopted May 17, 2008) addresses the ethical obligations of a lawyer who represents an organization as a party in a dispute, which the opinion defines to include both litigation and pre-litigation matters such as investigations. It complements Rule 4.2 and CBA Formal Opinion 69 (which address contacting employees of an adverse organization) by focusing instead on the duties of the lawyer who represents the organization. It does not address concurrent representation of the organization and its constituents, and it does not address attorney-client privilege questions.

The starting point is that a lawyer employed or retained by an organization represents the organization, which acts through its constituents (officers, directors, employees, shareholders), and does not thereby form an attorney-client relationship with those individuals. Quoting Rule 1.13 and its comments and Section 96 of the Restatement (Third) of the Law Governing Lawyers, the opinion stresses that it is critical to identify the client and maintain that clarity throughout the representation. It collects federal cases holding that an attorney-client relationship cannot be created unilaterally at the direction of the lawyer or the organization, and notes Colorado law is in accord that the relationship turns on the client's seeking and receiving legal advice.

From this, the opinion concludes that a lawyer who knowingly asserts that he or she represents current or former constituents, without a reasonable belief of an actual engagement, may violate two rules. Such a knowing assertion violates Rule 4.1's duty of truthfulness in statements to others. It may also violate Rule 3.4(a), because asserting representation blocks the adverse party's lawyer from communicating ex parte with those constituents under Rule 4.2, which can amount to unlawfully obstructing the adverse party's access to evidence.

When the lawyer represents only the organization and knows or reasonably should know that the organization's interests are adverse to a non-client constituent the lawyer is dealing with, Rule 1.13(f) requires the lawyer to clarify the lawyer's role. Per the opinion, the lawyer should advise the constituent that the organization is the client, that a conflict or potential conflict exists, that the lawyer cannot represent the constituent, that the constituent may wish to obtain independent representation, and that communications between the constituent and the lawyer may not be privileged. The opinion also reads Rule 3.4(f) to permit a lawyer to request a non-client to refrain from voluntarily giving information to another party only where the person is a relative, employee, or agent of a client (and other law does not bar the request) and the lawyer reasonably believes the person's interests will not be adversely affected, illustrating the limit with a truck-driver constituent (request ordinarily appropriate) versus an employee who may have suffered the discrimination alleged in a class action (request not appropriate).

In practice

Under the Colorado rules as they stood at the time of the opinion, the analysis turns on keeping the client's identity clear. The opinion holds that a lawyer representing an organization in a dispute represents the entity and does not automatically represent its constituents; that knowingly asserting representation of a constituent without a reasonable basis can violate Rule 4.1 and, by foreclosing the adversary's Rule 4.2 contact, Rule 3.4(a); and that Rule 1.13(f) requires the lawyer to give the constituent a corporate-Miranda style clarification once the lawyer knows the organization's interests are adverse to that constituent. It also holds that Rule 3.4(f) permits asking a non-client constituent not to volunteer information only within the two conditions the rule sets. Because the rules and comments in this area may have been amended since 2008, confirm Colorado's current Rules 1.13, 4.1, 3.4, and 4.2 before relying on the specifics.

Common questions

Q: If I represent a company, do I also represent its employees and officers?

A: No, not automatically. The opinion concludes that a lawyer employed or retained by an organization represents the organization, and that an attorney-client relationship with a constituent cannot be formed unilaterally just because the lawyer represents the entity.

Q: Can I tell opposing counsel that I represent the company's employees so they cannot be contacted directly?

A: Not unless you reasonably believe you were actually engaged by them. The opinion concludes that knowingly asserting representation of constituents without such a belief can violate Rule 4.1 (truthfulness) and Rule 3.4(a), because the assertion improperly blocks the adverse party's Rule 4.2 access to those people.

Q: What do I have to tell an employee whose interests differ from the company's?

A: You must clarify your role. Under Rule 1.13(f), the opinion says you should advise the constituent that the organization is your client, that you cannot represent the constituent, that the constituent may want independent counsel, and that your communications with the constituent may not be privileged.

Q: Can I ask a company employee not to talk to the other side?

A: Only within Rule 3.4(f)'s limits. The opinion concludes a lawyer may request a relative, employee, or agent of a client to refrain from voluntarily giving information to another party only if other law does not bar the request and the lawyer reasonably believes the person's interests will not be adversely affected.

Background and rules framework

The opinion interprets Colo. RPC 1.13 (organization as client) and 1.13(f) (clarifying the lawyer's role when interests diverge), Colo. RPC 4.2 and its Comment [7] (communication with represented persons, including organizations), Colo. RPC 4.1 (truthfulness in statements to others), and Colo. RPC 3.4(a) and 3.4(f) (fairness to opposing party; obstructing access to evidence and requesting persons to withhold information). It analogizes the duty to clarify the lawyer's role to Colo. RPC 4.3 on dealing with unrepresented persons, and relies on Section 96 of the Restatement (Third) of the Law Governing Lawyers.

Citations and references

Rules of Professional Conduct:

• Colo. RPC 1.13, 1.13(f) / Model Rule 1.13 (organization as client)
• Colo. RPC 4.2 and cmt. [7] / Model Rule 4.2 (communication with represented persons)
• Colo. RPC 4.1 / Model Rule 4.1 (truthfulness in statements to others)
• Colo. RPC 3.4(a), 3.4(f) / Model Rule 3.4 (fairness; obstructing evidence; requesting persons withhold information)
• Colo. RPC 4.3 / Model Rule 4.3 (dealing with unrepresented persons), by analogy

Cases:

• Harry A. v. Duncan, 330 F. Supp. 2d 1133 (D. Mont. 2004), an attorney-client relationship cannot be formed unilaterally
• People v. Bennett, 810 P.2d 661 (Colo. 1991), test for when an attorney-client relationship is established
• People v. Morley, 725 P.2d 510 (Colo. 1986), relationship arises when a client seeks and receives legal advice

Other opinions cited:

• CBA Formal Op. 69 (rev. 1987; add. 1995): communicating with employees of an adverse party organization
• Utah State Bar Ethics Advisory Op. 04-06 (2004): lawyer does not automatically represent an organization's employees

See also

• ABA Formal Op. 06-443: Contacting Inside Counsel
• ABA Formal Op. 91-359: Contacting Former Employees
• CBA Formal Op. 133: Lawyer-Party Contacting Adversary

Source

• Landing page: https://www.cobar.org/ethicsopinions
• Original PDF: https://www.cobar.org/Portals/COBAR/repository/ethicsOpinions/FormalEthicsOpinion_120_2011.pdf