Can a lawyer taking a government job hand his practice to a firm and become 'of counsel' to it?

Plain-English summary

An attorney appointed to a governmental position proposed to turn over all his files and library to a law firm for the benefit of his clients, who would be notified of the arrangement, would not be induced to engage the firm, and could retrieve their files if they wished. He would become "of counsel" to the firm, with no division of fees but a retainer of $100 a month for two years. The committee analyzed the arrangement Canon by Canon and found it permissible subject to several conditions.

Under Canon 37, the committee addressed the lawyer's continuing duty to preserve client confidences. Although the attorney proposed to advise his clients by letter, the committee's view was that he should retain his files until a client advised him in writing that the files could be turned over to the firm, because the duty to preserve confidences extends beyond the term of employment. Under Canon 6, the committee held the attorney must disclose to his clients all the circumstances of the agreement, especially information that might influence their choice of counsel, and must advise his clients of his new position's demand for undivided fidelity; he must also tell the firm it could not represent any client whose interest conflicted with the department where he was employed (citing ABA Opinions 128 and 192).

On the firm-affiliation questions, the committee said the opinions under Canon 27 would permit the "of counsel" connection provided neither he nor the firm used his name as advertising or held the firm out as being in a preferred position by reason of the connection. Under Canon 33, even though he was only "of counsel," the firm could not accept employment that the attorney himself could not (citing ABA Opinion 72). Finally, the committee advised that on leaving government service the attorney should observe Canon 36 and not accept employment connected with any matter he had passed upon while in that service.

Currency note

This opinion was issued in 1970 under the former Canons of Professional Ethics, which were in effect in Kentucky from 1946 to 1971, and predates both the 1990 adoption of the Rules of Professional Conduct (SCR 3.130) and the substantial 2009 revisions to those rules. The Canons it applied map to modern Model Rules 1.11 (former and current government officers, including the "matter he passed upon" restriction of former Canon 36), 1.6 (confidentiality, former Canon 37), 1.7 (conflicts, former Canon 6), and 7.5 (firm names and "of counsel" designations, former Canon 27). Treat this page as historical context, not current guidance. Verify against the current rules before relying on any specific rule or requirement mentioned here.

Common questions

Q: Could a lawyer taking a government job turn his clients' files over to a firm?

A: Yes, but under Canon 37 the committee advised he should retain the files until each client agreed in writing that they could be turned over, because the duty to preserve confidences continues after the representation ends.

Q: Could he become 'of counsel' to the firm and be paid for it?

A: Yes. The committee allowed an "of counsel" connection with a $100-per-month retainer and no fee division, provided his name was not used as advertising and the firm was not held out as being in a preferred position because of the connection.

Q: What limits did the arrangement place on the firm?

A: The committee held the firm could not represent any client whose interest conflicted with the government department employing the attorney, and could not accept employment that the attorney himself could not accept.

Q: What restriction applied when he later left government service?

A: Under Canon 36, the committee advised he should not, after leaving, accept employment connected with any matter he had passed upon while in government service.

Background and rules framework

The opinion applied several Canons of Professional Ethics to a lawyer's transition into government service: Canon 37 (preserving client confidences), Canon 6 (disclosure and conflicting interests), Canon 27 (use of a lawyer's name and "of counsel" designation), Canon 33 (partnerships and affiliations), and Canon 36 (post-employment restrictions on former government lawyers). The modern analogs are Model Rules 1.6 (confidentiality), 1.7 (conflicts), 1.11 (current and former government officers and employees), and 7.5 (firm names and designations), with Kentucky's counterparts at SCR 3.130.

Citations and references

Rules of Professional Conduct:

• Canons 6, 27, 33, 36, 37 (Canons of Professional Ethics); modern analogs Model Rules 1.6, 1.7, 1.11, 7.5

Other opinions cited:

• ABA Opinion 72 (firm cannot accept employment the affiliated lawyer could not)
• ABA Opinions 128 and 192 (duty to advise the firm against representing interests adverse to the lawyer's government department)

See also

• KBA Ethics Op. E-37: County Attorney Partner Before the Zoning Commission
• KBA Ethics Op. E-61: Officials and Partners Practicing Criminal Law
• KBA Ethics Op. E-62: Firm Name Without a True Partnership

Source

• Landing page: https://kybar.org/For-Members/Rules-Ethics-Information/Ethics-Opinions
• Original PDF: https://kybar.org/Portals/0/Admin/Ethics%20Opinions/KBA_E-038.pdf

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

KENTUCKY BAR ASSOCIATION
Ethics Opinion KBA E-38
Issued: April 1970

This opinion was decided under the Canons of Professional Ethics, which were
in effect from 1946 to 1971. Lawyers should consult the most recent version of
the Rules of Professional Conduct and Comments, SCR 3.130 (available at
http://www.kybar.org), before relying on this opinion.

Question:

An attorney accepting a governmental position must use caution in
notifying clients of his inability to represent them, and he may be a member
of a firm provided his name is not used for advertising.

References:

Canon 6, 27, 33, 36, 37
OPINION

Upon being appointed to a governmental position an attorney proposes to transfer
and turn over all his files and library to a law firm for the use and benefit of his clients. The
clients will be given notice of the arrangement, they will not be induced to engage the firm,
and they may obtain their files from the firm if they desire.
The attorney proposes to become “of counsel” to the firm, there is to be no
division of fees for services rendered by the firm or any of its members, but for services
rendered the attorney is to be paid a retainer of $100 a month for a period of two years.
The agreement, in writing, concludes with a statement to the effect that all aspects
of the agreement shall be governed by the Canons of Ethics of the American Bar
Association and executed in the best interest of the attorney’s clients.
Since the foregoing arrangement may be affected by a number of canons, their
application will be discussed in order.
At the outset, Canon 37 may materially affect the agreement unless some direct
effort is made by the attorney to preserve such confidences he may have obtained during
the attorney-client relationship. While the attorney proposes to fully advise his clients by
letter it is the opinion of this Committee that the attorney should retain his files until such
time as he may be advised by his clients. in writing, that they may be turned over to the
firm. A lawyer’s duty to preserve the confidences of his client extends beyond the term of
his employment and should never be disposed in any manner calculated to be of an
advantage to the lawyer or a disadvantage to the client.
Under Canon 6 it is the duty of the attorney in this instance to disclose to his clients
all the circumstances connected with the agreement with the firm, especially such

information as might influence the clients in the selection of counsel within the firm or out
of it. In addition, the attorney must clearly advise his clients of his new position requiring
his undivided fidelity in the event of a conflict of interest. He must likewise advise his firm
that it cannot undertake to represent any client whose interest may be in conflict with the
department wherein the attorney is employed. See ABA Opinions 128 and 192.
While the attorney is not to be a member of the firm the opinions under Canon 27
would permit him to do so provided that he or the firm not use his name as a means of
advertising or hold itself out as being in some preferred position by reason of the attorney’s
“of counsel” connection.
While Canon 33 deals mainly with the formation of partnerships and the attorney
here is only “of counsel,” opinions cited under this canon clearly point out that members of
the firm could not accept employment if the attorney himself could not. ABA Opinion 72.
Finally, the attorney should be advised to observe Canon 36 upon termination of his
government service. He should not, after his retirement, accept employment in connection
with any matter which he has passed upon while in such service.

Note to Reader
This ethics opinion has been formally adopted by the Board of Governors of the
Kentucky Bar Association under the provisions of Kentucky Supreme Court Rule 3.530
(or its predecessor rule). The Rule provides that formal opinions are advisory only.