Ezel / Ethics Opinions / OSB
OSB August 2005

When can a lawyer add a corporation's officers, employees, or shareholders as defendants alongside the corporation?

Short answer: The opinion concludes a lawyer may join individuals only where a reasonable investigation shows a nonfrivolous basis for their liability; joining them with no reasonable basis violates the rules against frivolous and harassing litigation, with a narrow exception when a limitations deadline prevents full pre-filing investigation.

Apply this to your situation

This page answers the general question as of 2005. Ezel answers yours: whether it's allowed on your facts, under the current Oregon Rules of Professional Conduct, with citations.

Currency note: this opinion is from 2005
Subsequent statutory amendments, court decisions, or later opinions or rule amendments may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.
Disclaimer: Advisory only. Not binding precedent.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official ethics opinion. The original opinion (linked on this page as a PDF) is the authoritative source for any reliance.
View original ethics opinion (PDF)

Plain-English summary

A potential plaintiff bought defective goods from a corporation and may have a valid claim against it. The plaintiff hires a lawyer. The opinion asks when the lawyer may name the corporation's officers, employees, or shareholders as defendants in addition to the corporation itself.

The opinion frames the answer under Oregon RPC 3.1, which bars knowingly asserting a position without a nonfrivolous basis in law and fact, and Oregon RPC 4.4(a), which bars using means that have no substantial purpose other than to embarrass, delay, harass, or burden a third person. After a reasonable investigation, as required by RPC 1.1 (competence) and RPC 1.2(a), the lawyer's path depends on what that investigation shows.

If the investigation reveals a reasonable, nonfrivolous basis to join particular individuals (for example, officers and employees potentially liable in tort for their own misrepresentations, or shareholders potentially liable under a piercing-the-corporate-veil theory), the opinion concludes the lawyer may, and presumably should, join them. If the investigation reveals no reasonable basis to suspect any individual liability, the opinion concludes joining them would violate RPC 3.1 and RPC 4.4(a); the opinion also points to FRCP 11, ORCP 17 A, and RPC 3.4(c).

The opinion then addresses the harder case where the plaintiff comes to the lawyer just before the limitations period runs, leaving no time for a full pre-filing investigation. It concludes joining the additional defendants is ethical in that limited circumstance only if each of three conditions holds: (1) the individuals will not consent to an extension of the limitations period or seeking one is impossible or impracticable; (2) the lawyer acts diligently after filing to determine whether a viable claim exists; and (3) if no such claim exists, the lawyer promptly dismisses the additional defendants.

In practice

The opinion holds that, under the Oregon rules as they stood at the time of the opinion, the propriety of adding individual defendants turns on the investigation: a nonfrivolous basis permits (and may call for) joinder, while joining individuals with no reasonable basis is frivolous and harassing conduct under RPC 3.1 and RPC 4.4(a). The opinion identifies a narrow deadline-driven exception conditioned on the inability to extend the limitations period, diligent post-filing investigation, and prompt dismissal if no claim materializes. Verify the current text of Oregon RPC 3.1, RPC 4.4, and the procedural rules before relying on any specific step.

Common questions

Q: Can I sue a company's officers and shareholders along with the company?

A: Only with a nonfrivolous basis. The opinion concludes the lawyer may join individuals where a reasonable investigation shows a basis for their liability (such as individual tort liability or veil-piercing), and presumably should in that case.

Q: What if my investigation shows no basis to sue the individuals?

A: Then joining them is improper. The opinion concludes naming individuals with no reasonable basis violates Oregon RPC 3.1 and RPC 4.4(a).

Q: What if the statute of limitations is about to run before I can investigate?

A: The opinion allows joinder in that narrow case only if an extension cannot be obtained, the lawyer investigates diligently after filing, and the lawyer promptly dismisses any individual against whom no viable claim exists.

Background and rules framework

The opinion interprets Oregon RPC 3.1 (meritorious claims), RPC 4.4(a) (no harassment of third persons), RPC 1.1 (competence), RPC 1.2(a) (scope of representation), and RPC 3.4(c) (disobeying tribunal rules), corresponding to Model Rules 3.1, 4.4, 1.1, 1.2, and 3.4. It also references the procedural anti-frivolity rules FRCP 11 and ORCP 17 A.

Citations and references

Rules of Professional Conduct:

  • Oregon RPC 3.1 / Model Rule 3.1 (meritorious claims and contentions)
  • Oregon RPC 4.4(a) / Model Rule 4.4 (respect for rights of third persons)
  • Oregon RPC 1.1 / Model Rule 1.1 (competence)
  • Oregon RPC 1.2(a) / Model Rule 1.2 (scope of representation)
  • Oregon RPC 3.4(c) / Model Rule 3.4 (disobeying tribunal rules)

Statutes and procedural rules:

  • FRCP 11; ORCP 17 A (prohibiting frivolous pleadings)

Cases:

  • In re Leuenberger, 337 Or 183, 93 P3d 786 (2004)
  • Seely v. Hanson, 317 Or 476, 857 P2d 121 (1993)
  • In re White, 311 Or 573, 815 P2d 1257 (1991)

See also

Source

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