Can a law firm second (loan) a lawyer to a client or host organization without the firm inheriting the host's conflicts and vice versa?

Plain-English summary

The opinion addresses "secondment," the practice of temporarily placing a firm lawyer as inside counsel at a host organization such as a client, agency, or charity. The question is when such an arrangement causes the firm's conflicts to be imputed to the host (and the host's to the firm) under DR 5-105(D). The committee, applying the former New York Code, concludes that imputation turns on whether the seconded lawyer remains "associated" with the firm.

If the lawyer remains associated with the firm during the secondment, conflicts run both ways: DR 5-105 would bar the lawyer from acting for the host adversely to a current firm client, DR 5-108 bars adverse work against former firm clients in substantially related matters, and confidential information the lawyer learns at the host can be imputed to the firm. Because curing that through informed consent would require disclosures the affected clients are unlikely to make, the representations would be precluded.

The Code does not define "associated," so the committee applies the functional analysis used in ABA Op. 88-356, N.Y. State 715, and the Second Circuit's Hempstead Video decision: the closer and broader the affiliation, and the greater the chance of becoming privy to client confidences, the more appropriate imputation is; the more narrowly limited the relationship and the more secure the screening, the less appropriate. The committee concludes that where the ongoing relationship is narrowly limited (the lawyer works solely under the host's direction) and the lawyer is securely and effectively screened from the firm's client confidences, the lawyer is not associated with the firm and conflicts are not imputed. Incidental ties, such as an expected return, retained seniority or pension benefits, or use of firm email without access to client confidences, do not change that result.

The committee adds several refinements. A partial secondment (the lawyer splits time between host and firm) keeps the lawyer associated with the firm, so conflicts are imputed. If the firm merely supervises the lawyer in finishing a host matter the lawyer began at the firm, no additional conflicts are imputed, but supervising new host matters can recreate association. Compensation arrangements (the firm continuing to pay the lawyer, or the host paying the firm) do not by themselves create association, so long as the firm does not direct the lawyer's professional judgment and the lawyer lacks access to firm confidences; where the host pays the firm, DR 5-104's business-transaction requirements apply, and a written secondment contract is essential. Regardless of how the secondment is structured, the lawyer's former-client duties under DR 5-108 continue.

In practice

The opinion was issued in 2007 under the former New York Code, which the New York Rules of Professional Conduct replaced effective April 1, 2009; the imputation analysis maps onto current Rules 1.9, 1.10, and 1.8, and DR 5-105(D)'s text closely tracks Model Rule 1.10(a). Under the framework as it stood at the time, the opinion holds that a secondment avoids two-way imputation only when the lawyer is not associated with the firm, which the committee ties to a narrowly limited ongoing relationship and secure, effective screening from firm client confidences, documented in a written secondment agreement. It treats a partial secondment as keeping the lawyer associated, and notes former-client conflicts under DR 5-108 persist during and after the secondment.

Common questions

Q: When does seconding a lawyer to a client impute the firm's conflicts to the host?

A: When the lawyer remains "associated" with the firm. If the relationship is narrowly limited and the lawyer is securely screened from firm client confidences, the opinion concludes the lawyer is not associated and conflicts are not imputed.

Q: Does a part-time secondment work the same way?

A: No. The opinion concludes a partial secondment, where the lawyer splits time between host and firm, keeps the lawyer associated with the firm, so conflicts are imputed both ways.

Q: Does it matter who pays the seconded lawyer?

A: Not by itself. The firm paying the lawyer, or the host paying the firm, does not create association so long as the firm does not direct the lawyer's judgment and the lawyer cannot access firm confidences; if the host pays the firm, DR 5-104's business-transaction rules apply.

Q: Do the lawyer's duties to former clients end during the secondment?

A: No. The opinion holds the seconded lawyer must still comply with DR 5-108, so cannot take host matters substantially related to, and adverse to, a former firm client without consent.

Background and rules framework

The opinion interprets the former New York Code's imputation and conflict provisions, DR 5-105(D) (imputation within a firm), DR 5-105 (concurrent conflicts), DR 5-108 (former-client conflicts), DR 5-104 (business transactions with a client), DR 5-107(B) (third-party compensation not directing judgment), and DR 4-101 (confidences and secrets). These correspond to Model Rules 1.10 (imputation), 1.7 (concurrent conflicts), 1.9 (former clients), 1.8(a) and 1.8(f) (business transactions and third-party payment), and 1.6 (confidentiality). The committee builds its "association" test on the functional analysis of ABA Op. 88-356, N.Y. State 715, and Hempstead Video, Inc. v. Village of Valley Stream.

Citations and references

Rules of Professional Conduct:

• MR 1.10 / NY DR 5-105(D) (imputed disqualification)
• MR 1.9 / NY DR 5-108 (duties to former clients); MR 1.7 / NY DR 5-105 (concurrent conflicts)
• MR 1.8(a) / NY DR 5-104 (business transactions with a client); MR 1.8(f) / NY DR 5-107(B) (third-party compensation)
• MR 1.6 / NY DR 4-101 (confidentiality)

Cases:

• Hempstead Video, Inc. v. Village of Valley Stream, 409 F.3d 127 (2d Cir. 2005), functional "of counsel" association test for imputation
• Levine v. Levine, 56 N.Y.2d 42 (1982), right to counsel of choice in the conflicts context

Other opinions cited:

• ABA Op. 88-356 (1988); ABA Op. 90-357 (1990); N.Y. State 715 (1999); N.Y. State 793 (2006)
• ABCNY Formal Op. 2006-2 (screening factors); ABCNY Formal Op. 2005-2; ABCNY Formal Op. 2003-03; ABCNY Formal Op. 1996-8

See also

• NYC Bar Ethics Op. 2009-03: Conflicts From Hiring Law School Graduates Who Worked in Clinics
• NY State Bar Op. 1064: Former Judge Conflict and Firm Screening
• NY State Bar Op. 1105: Imputed Conflict From a Part-Time Public Defender

Source

• Landing page: https://www.nycbar.org/reports/formal-opinion-2007-02-secondment-of-law-firm-attorneys-association-with-a-law-firm-for-purposes-of-imputed-disqualification/
• Original PDF: https://www.nycbar.org/wp-content/uploads/2023/05/20071340-Formal_Opinion_2007-2_Law_Firm_Secondments.pdf