Is it ethical to represent multiple plaintiffs when the defendant makes an all-or-nothing blanket settlement offer?

Plain-English summary

The inquirer represented multiple plaintiffs in two suits and asked whether it is ethical for a defendant to make "blanket offers" to multiple plaintiffs. In the first matter, four automobile passengers sued their driver with no alleged conflict among them, and on the eve of trial the carrier offered different amounts per plaintiff on an all-or-nothing basis (three of four agreed). In the second, a chemical-exposure case with many plaintiffs, an offer was tied to near-unanimous acceptance, with a substantial number of claims to be dismissed if the group did not accept.

The Committee concluded there is no ethical problem in representing multiple plaintiffs who have no apparent conflict of interest among themselves. The conflict, it explained, does not arise until the blanket offer is made, and in that event RPC 1.8(g) (the rule on aggregate settlements of multiple clients' claims) governs the lawyer's handling. As to plaintiffs with potential statute-of-limitations differences, the Committee saw no ethical problem, treating the limitations question as a matter of law for the trial judge.

The Committee declined to treat the defendant's side as an ethics question for it: the conduct of the defendants' insurance carriers is not within its purview, and where a defendant's attorney transmits the client's lawful blanket offer, the Committee perceived no ethical violation, since counsel must make any legal offer the client directs.

Currency note

This opinion was issued in 1988, before New Jersey's adoption of the 2004 revisions to the Rules of Professional Conduct. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule mentioned here.

Common questions

Q: Can one lawyer represent several plaintiffs against the same defendant?

A: Per the opinion, yes, where there is no apparent conflict of interest among the plaintiffs; the Committee saw "no ethical problem involved in representing multiple plaintiffs."

Q: What happens when the defendant makes an all-or-nothing blanket offer?

A: The Committee said the conflict "does not arise until the blanket offer is made, and in that event RPC 1.8(g) governs," that is, the rule on aggregate settlements of multiple clients' claims.

Q: Is it unethical for the defendant or its carrier to make such an offer?

A: The Committee declined to police that side: the carrier is not governed by the Rules, and a defense lawyer transmitting the client's lawful offer commits no ethical violation.

Background and rules framework

The opinion applies NJ RPC 1.8(g) (Model Rule 1.8(g)), which governs a lawyer's making an aggregate settlement of the claims of multiple clients. The analysis distinguishes the permissible joint representation of non-conflicting plaintiffs from the conflict that an all-or-nothing offer creates, which the lawyer must then handle under RPC 1.8(g).

Citations and references

Rules of Professional Conduct:

• MR 1.8 / NJ RPC 1.8(g) (aggregate settlements of multiple clients' claims)

See also

• NJ ACPE Op. 615: Representing a Plaintiff Whose Defendant Is a Relative
• NJ ACPE Op. 613: Withdrawing Attorney Claiming a Referral Fee After a Driver/Passenger Conflict

Source

• Full text (Justia mirror): https://law.justia.com/cases/new-jersey/advisory-committee-on-professional-ethics/2004/acp616-1.html
• Issuing authority: New Jersey Supreme Court Advisory Committee on Professional Ethics, via the NJ Courts Supreme Court Committees page

Original opinion text

Reproduced from a full-text mirror of the official opinion for research purposes. The linked official source controls. The mirror interleaves the two inquiries; the substantive analysis (questions A, B, and C) reads in order.

122 N.J.L.J. 764, September 22, 1988

OPINION 616

Blanket Settlement Offers to Multiple Plaintiffs

The Inquirer, an attorney appearing for multiple plaintiffs in two separate suits, asks "whether or not it is ethical for a defendant to make 'blanket offers' to multiple plaintiffs."

In the first suit, the attorney represented four passengers in an automobile who instituted suit against the driver of the car in which they were riding. The Inquirer states that there was no evidence, nor even an allegation, of any fact that would raise a potential conflict of interest among the various plaintiffs, although they did have different injuries and varying degrees of strength of their liability claims against the driver because their injuries occurred at different times during the course of the happening of the accident for which their driver was alleged to be partly responsible. It appears that on the eve of trial, the defendant's insurance carrier made offers of different amounts for each plaintiff passenger, which offers were conditioned, however, that "... the offer was all or nothing at all, either all the plaintiffs had to accept the offer or there was no offer." It further appears that the Inquirer contacted his clients, and that three of the four plaintiffs agreed to accept the offer; the fourth did not.

B) If it is ethically appropriate for a plaintiff's attorney to, in fact, represent multiple passengers who have no factual or legal conflict of interest, then is it ethical for the defendant to make offers that are tied together and thereby place the plaintiff's attorney potentially, and in my particular case, in a conflict of interest situation? The question does not involve a matter of ethics whether such offer is made by the insurance carrier (who would not be governed by our Rules of Professional Conduct) or by the defendant's attorney, if the carrier's "tie-in" offer is transmitted by him to the plaintiffs' attorney.

This offer was communicated to the plaintiffs in accordance with the Court's instructions; however, there was reluctance on the part of a fairly substantial number of plaintiffs to accept the settlement. However, when it was explained that if the settlement offer was not accepted, perhaps a hundred of their co-workers might have their claims dismissed, all but a very inconsequential number of plaintiffs accepted this settlement, and a separate settlement conference was held to resolve the claims of those few plaintiffs who had not accepted the settlement proposal. He, therefore, raises the following questions:

A) Is it ethically appropriate for an attorney to represent multiple plaintiffs in a chemical exposure case where they have no apparent conflict of interest between them, but where one can be created de facto by the defendants' attorneys by means of a "blanket offer" in which the defendants state that either the entire group accepts the offer, or a substantial part of the offer will be withdrawn, and a substantial number of plaintiffs will be dismissed?

We see no ethical problem involved in representing multiple plaintiffs in a chemical exposure case, or in any other case, where there is no apparent conflict of interest among the plaintiffs themselves. The conflict does not arise until the blanket offer is made, and in that event RPC 1.8(g) governs.

B) If it is ethical for an attorney to represent multiple plaintiffs in a chemical exposure case, (which I believe it is), does it then become unethical for that attorney to continue to do so when it appears that some of the plaintiffs have potential Statute of Limitations problems, whereas others do not?

We see no ethical problem involved. The question of the Statute of Limitations is a matter of law and, presumably, would be dealt with by the trial judge during the course of the proceedings.

The Inquirer asks further:

C) If it is ethical to continue to represent the plaintiffs in such a situation, (which I believe it is), does it then become unethical for the defendants to make a "blanket offer" stating that if the entire group of plaintiffs does not accept the offer, than [sic] a substantial portion of the plaintiffs will receive no offer, and in fact, may have their cases dismissed? Such a circumstance, in my opinion, clearly gives the defendants the unilateral ability to place the plaintiffs' attorney in a conflict of interest situation where he is now called upon, in essence, to trade-off the best interest of some of the plaintiffs for the benefit of the whole group.

The matter of the ethics of the defendants' insurance carriers is not one to be considered by this Committee. If the question relates to the blanket offer being transmitted by the attorneys for the defendants, we still perceive no ethical involvement by the defendants' attorneys, who, pursuant to their clients' valid instructions, tendered the blanket offer. It is those attorneys' obligation in representing their clients to make any legal offer they direct them to make.