What settlement-release clauses are off-limits in Tennessee personal injury cases, including ones that limit a plaintiff lawyer's future practice?

Plain-English summary

The opinion addressed four types of clauses an attorney had encountered in releases prepared to settle medical malpractice and other personal injury actions: confidentiality clauses, clauses requiring plaintiff's counsel to become a party to the release, clauses releasing the defense attorney along with the defendant, and clauses restricting the plaintiff or plaintiff's counsel from using case information to assist other litigants.

On confidentiality clauses, the opinion concluded that no disciplinary rule prohibits them. It treated releases as contracts (noting an acceptance that does not mirror the offer is a counteroffer, so a clause is negotiable) and stated that the public-policy argument for a total ban is properly addressed to the Supreme Court, because the function of an ethics opinion is not to make public policy.

On clauses requiring plaintiff's counsel to become a party, the opinion concluded that an attorney's signature should vouch only that the client releases the defendant, and that requiring plaintiff's counsel to be a party could create a conflict of interest with the client under DR 5-101(A); such clauses are therefore prohibited except where plaintiff's counsel releases a claim for attorney fees. On clauses releasing defense counsel, it reasoned that defense counsel is not a proper party except as the client's representative, and that plaintiff's counsel would be justified in refusing such a term in most circumstances.

On clauses restricting use of case information, the opinion relied on DR 1-208(B), which bars a lawyer, in connection with settling a controversy or suit, from entering an agreement that restricts the right to practice law. As to existing clients, it concluded such a clause could amount to settling one client's case to another client's detriment, a representation of differing interests under DR 5-105. As to future clients, it followed ABA Formal Ethics Opinion 93-371 that proposing a settlement restriction on a plaintiff's attorney representing future claimants against the same defendant is ethically inappropriate.

Currency note

This opinion was issued in 1998, before Tennessee's adoption of the 2003 Rules of Professional Conduct, which replaced the former Code of Professional Responsibility (including DR 1-208(B), DR 5-101(A), and DR 5-105) on which it relied, and before the ABA's 2002 Ethics 2000 revisions. The restriction-on-practice principle now appears in RPC 5.6. Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance, and verify against the current rules before relying on any specific requirement mentioned here.

Common questions

Q: Can a settlement bar a plaintiff's lawyer from taking future cases against the same defendant?

A: Per the opinion, no. It concluded that proposing such a restriction is ethically inappropriate, following DR 1-208(B) (no settlement agreement restricting the right to practice) and ABA Formal Opinion 93-371.

Q: Are settlement confidentiality clauses prohibited in Tennessee?

A: The opinion concluded that no disciplinary rule prohibits them, and that the policy argument for a total ban is for the Supreme Court, not an ethics opinion, to address.

Q: Can the defense require plaintiff's counsel to sign the release as a party?

A: Per the opinion, such a clause is prohibited because it could create a conflict with the client under DR 5-101(A), except where plaintiff's counsel is releasing a claim for attorney fees.

Background and rules framework

The opinion interpreted the former Code's DR 1-208(B) (no settlement agreement restricting the right to practice), DR 5-101(A) (employment affected by the lawyer's own interests), and DR 5-105 (differing interests). The modern analogs are RPC 5.6 (Model Rule 5.6) on restrictions on the right to practice and RPC 1.7 (Model Rule 1.7) on conflicts. It relied on ABA Formal Ethics Opinion 93-371.

Citations and references

Rules of Professional Conduct (former Code):

• DR 1-208(B) (no settlement agreement restricting the right to practice). Modern analog: Model Rule 5.6 / Tennessee RPC 5.6
• DR 5-101(A) (employment affected by lawyer's own interests); DR 5-105 (differing interests). Modern analog: Model Rule 1.7 / Tennessee RPC 1.7

Other opinions cited:

• ABA Formal Ethics Opinion 93-371 (settlement restrictions on representing future claimants)

See also

• Arizona Op. 90-06: Confidentiality and Restrictions on Practice
• DC Op. 335: Settlement Confidentiality of Public Case Information
• ABA Formal Op. 06-444: Restrictive Covenants and Retirement Benefits

Source

• Landing page: https://www.tbpr.org/ethic_opinions/98-f-141

Original opinion text

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

98-F-141 - Settlement Clause restricting right to practice

BOARD OF PROFESSIONAL RESPONSIBILITY OF THE SUPREME COURT OF TENNESSEE

FORMAL ETHICS OPINION 98-F-141

Inquiry is made about the ethical propriety of certain types of clauses included in releases signed to document settlement of personal injury cases.

The inquiring attorney has encountered certain clauses included in releases prepared for settlement of medical malpractice and other personal injury actions.

The four types of clauses mentioned by the inquiring attorney include confidentiality clauses, clauses requiring plaintiff’s counsel to become a party to a release, clauses releasing the defense attorney in addition to the defendant, and clauses restricting the plaintiff or plaintiff’s counsel from using case information to assist other litigants or claimants.

Confidentiality Clauses

Confidentiality clauses are provisions in a release which provide that the terms and conditions of the settlement are confidential and that the plaintiff and plaintiff’s counsel will not reveal the terms and conditions of the settlement. The inquiring attorney states that confidentiality clauses are usually not negotiated and that they are forced upon the plaintiff after a settlement has been reached. Releases are contracts. Our understanding of contract law is that an acceptance which does not mirror the offer is a counter offer. A prohibition against negotiation of a release containing a confidentiality clause is inappropriate. No disciplinary rule prohibits such clauses.

The inquiring attorney makes a public policy argument supporting a total ban on confidentiality agreements. Those arguments are more properly addressed to the Supreme Court. The function of an ethics opinion is not to make public policy.

Clauses requiring plaintiff’s counsel to become a party to a release

The attorney’s signature on a release should vouch only for the fact that the client releases the defendant. A requirement that a plaintiff’s attorney become a party to a release might create conflict of interest between plaintiff’s attorney and the plaintiff in violation of DR 5-101(A). Therefore, these clauses are prohibited except in cases where the plaintiff’s attorney releases a claim for attorney fees.

Clauses releasing the defense lawyer in addition to the defendant

Just as in the case of a plaintiff’s attorney, defense counsel is not a proper party to a release except as the representative of the client. It is our opinion that plaintiff’s counsel would be justified in refusing to negotiate such a term in most circumstances.

Clauses restricting plaintiff or plaintiff’s counsel from using case information to assist other litigants or claimants

DR 1-208(B) provides that:

“In connection with a settlement of a controversy or suit, a lawyer shall not enter into an agreement that restricts the right to practice law.”

As to existing clients, inclusion of such a clause in a release could be construed as the settlement of one client’s case to the detriment of another client’s case. Such a clause would constitute representation of differing interests in violation of DR 5-105.

As to future clients, ABA Formal Ethics Opinion 93-371 provides that it is ethically inappropriate to propose as part of a settlement agreement a restriction of a plaintiff’s attorney from representing future claimants against the same defendant. Such clauses are ethically inappropriate.

ETHICS COMMITTEE:

Herman Morris, Jr, Chair

Frankie E. Wade

James M. Glasgow, Jr.

APPROVED AND ADOPTED BY THE BOARD

This 4th day of February, 1998.