Concept
Conflict-Check Disclosure
Disclosure required by law or court order, and for conflict checks
Conflict-Check Disclosure
A firm that wants to hire a lawyer, or to combine with another firm, cannot know which conflicts it would acquire until it learns whom the newcomer has represented. Rule 1.6(b)(7) closes that gap. It permits a lawyer to reveal information relating to the representation of a client “to detect and resolve conflicts of interest arising from the lawyer’s change of employment or from changes in the composition or ownership of a firm, but only if the revealed information would not compromise the attorney-client privilege or otherwise prejudice the client.”1
The exception is needed because Rule 1.6(a) otherwise forbids the conversation. A lawyer may not reveal information relating to the representation unless the client gives informed consent, the disclosure is impliedly authorized in order to carry out the representation, or paragraph (b) permits it.2 That category reaches all information the lawyer holds that relates to the representation,3 so a client’s identity and the general nature of a matter fall within it. Without (b)(7), a lateral candidate who named a former client to a prospective employer would first need that client’s consent.
The rule has two triggers and one proviso. A lawyer’s change of employment is the first trigger; a change in the composition or ownership of a firm is the second. The proviso governs both, and it matters most because the client whose information moves usually takes no part in the hiring or merger talks. Like every paragraph (b) exception, the rule is permissive and reaches only the information the lawyer “reasonably believes necessary” for its purpose.4 The first trigger comes first.
Lawyer Changes Employment
A lateral hire brings her client history with her, and that history can burden her new firm. The analysis runs in two steps. The moving lawyer is first presumed to have acquired confidential information of a client of her former firm, and she may try to rebut the presumption. If she cannot, she is presumed to share that information with the other lawyers at her new firm, and a timely screen can rebut that second presumption only in a jurisdiction that recognizes screening to block imputation. The Model Rules position on screening appears in Rule 1.10(a)(2).5 The burden at the first step rests on the lawyer: she must establish that she did not, in fact, acquire confidential information about the person who is now adverse to a client of her new firm.6
The first presumption is rebuttable, and rebuttal is a matter of fact. In Adams v. Aerojet-General Corp., a California court refused to disqualify an attorney on imputed knowledge derived solely from membership in the former firm, without inquiry into the attorney’s actual exposure to the former client’s secrets. A rule that sweeps so broadly, the court said, is inconsistent with the language and core purpose of the conflict rule and unnecessarily restricts both the client’s right to chosen counsel and the attorney’s freedom of association.7 The court’s task is to decide whether confidential information material to the current representation would normally have been imparted to the attorney at the old firm. It looks to the relationship, if any, between the attorney and the former client’s representation, to any time the attorney spent working for that client, and to the attorney’s possible exposure to the formulation of policy or strategy in matters relating to the current dispute.8
The facts can favor the lawyer. In Dieter v. Regents of the University of California, the court refused to impute knowledge of client confidences to attorneys merely because they belonged to the firm that had represented the former client. The evidence showed that the attorneys had no contact with that client’s matters at the old firm, so the court denied the motion to disqualify.9 Doubt, however, cuts the other way. Courts resolving conflicts of interest “resolve all doubts in favor of disqualification” to prevent the appearance of impropriety, as the court in Burgess-Lester v. Ford Motor Co. put it.10
Those three points explain why information must move before the hire. The burden sits on the lawyer, the inquiry turns on her actual work, and doubt favors disqualification. A new firm cannot judge her prospects without knowing which former client was involved, what general kind of matter it was, what role she played, and who stood on the other side. With those facts, the firm can compare them against its own docket and ask the follow-up questions that Adams demands. Without them, it hires first and meets the conflict later, when a motion to disqualify forces the issue.
The White & Pinkman facts show where a check begins. The firm represented Fring, a local businessman, in negotiations to acquire a commercial laundry facility, and Fring revealed confidential information about his financial dealings, including debts he owed to several banks. Corporate lawyers handled the negotiations. Goodman, an associate, represented Fring in personal-injury cases arising from minor slip-and-fall incidents at a local chain of restaurants Fring owned.11 The laundry deal belonged to others; Goodman’s work was the injury cases.
Goodman’s next task is to rebut the presumption, and the facts he needs are facts about his own work: which matters he handled, how much time he spent, and whether he had any exposure to policy or strategy in related matters. He can supply those without repeating anything Fring said. The exception lets information pass only to detect and resolve the conflict, so the check reaches identities, the general nature of the work, and the lawyer’s involvement, and it stops short of the substance of the client’s affairs.
Detection is half of the exception’s purpose, and resolution is the other half. If the check reveals a conflict, the firm and the lawyer can look for a cure. Where the jurisdiction recognizes screening, a timely screen is one way to block imputation, and screening a personally disqualified lawyer is a recognized means of avoiding imputed disqualification of the new firm.12 The mechanics belong to the conflicts readings. Here the point is that (b)(7) covers information for both detecting and resolving the conflict, and the proviso limits both.
Firm Composition or Ownership Changes
The second trigger shifts from one lawyer’s career to the firm as a unit, and it carries the same proviso as the first: disclosure is permitted only if it would not compromise the attorney-client privilege or otherwise prejudice the client.14 The trigger covers conflicts arising from “changes in the composition or ownership of a firm.” A merger is the clearest case, because two groups of lawyers become one firm. The text draws no sharp line between this trigger and the change-of-employment trigger, and the line rarely matters, since both let a firm learn of conflicts before the change takes effect.
Imputation explains why firm-level changes need their own coverage. A conflict held by one lawyer reaches the other lawyers associated with her in a firm, unless a recognized screen blocks it.15 When two firms combine, each side’s conflicts can reach the other side’s lawyers and clients, and a firm that learns of a clash only after closing finds itself adverse to its own client with the combination already complete. The firms therefore need client-level information from each other while the decision to combine is still open.
Ordinary confidentiality rules do not supply that information. Within a firm, a lawyer is impliedly authorized to share client confidential information with other persons in the firm as necessary to perform the representation, unless the client has indicated that only designated lawyers may have access.16 Implied authorization exists to carry out the representation,17 and here it runs to colleagues inside the firm. Lawyers at a firm that has not yet merged with this one are outsiders, and handing them a client list does nothing to advance the client’s matter. Paragraph (b)(7) therefore does the work that implied authorization cannot.
Two features set this trigger apart from the lateral move. Information flows both ways, because each firm discloses and receives, and it concerns the clients of both firms, none of whom has been asked. The limit on the exchange therefore carries more weight. As under every paragraph (b) exception, the lawyer may reveal only what she reasonably believes necessary to detect and resolve the conflict,18 and for a comparison of two client lists that usually means each client’s identity, the general nature of the matter, and the opposing parties.
The usual way to overshoot is to treat merger diligence as license to share everything. The ceiling follows the purpose of the check, and a conflicts comparison needs far less than a full account of each client’s affairs.
Fact patterns usually fail at step three, when a firm sends more than the comparison needs, and the closer cases turn on step four.
Privilege and Prejudice Limits
The closing words of Rule 1.6(b)(7) qualify both triggers: disclosure is permitted “but only if the revealed information would not compromise the attorney-client privilege or otherwise prejudice the client.”20 The proviso holds two limits. The first protects a particular legal shield, the privilege. The second, introduced by “or otherwise,” catches every other way the disclosure could harm the client. A disclosure must clear both. Because the exception works without the client’s consent, and the client typically sits outside the hiring or merger talks, the proviso is the only protection the client has when the information moves.
The proviso works alongside the necessity limit that governs every paragraph (b) exception: the lawyer may reveal information only “to the extent the lawyer reasonably believes necessary.”21 The two limits measure different things. Necessity caps how much the lawyer may reveal for the check. The proviso caps what the revealing may do to the client. A disclosure no larger than the check requires can still fail the proviso when the one fact the check needs is itself damaging, and a harmless fact can still exceed the exception when the lawyer volunteers more than the check calls for.
Confidentiality and privilege cover different ground. The duty of confidentiality reaches all information the lawyer holds that relates to the representation. The privilege attaches to a special subset, the communications between lawyer and client that are entitled to be held immune from legal process and that may not be adduced as evidence against the client.22 The privilege also resists the pressure of need: it is not subject to an exception simply because a private litigant, government agency, or other third party claims an important need to know what the client discussed with an attorney.23 The proviso reflects the same priority. A new firm’s need to clear a hire, however real, does not buy access to anything that threatens the privilege.
The check rarely needs any of that content. That the lawyer represented a named client in a patent dispute, in what role, and against whom answers the conflict question and conveys no privileged communication.
The prejudice limb reaches harms the privilege limb cannot. Because the confidentiality duty covers all information the lawyer holds that relates to the representation, much of what a lawyer knows about a client is protected without being privileged.24 A rule written only about privilege would let such information flow freely even when it would damage the client in an adversary’s hands. The “otherwise prejudice” limb closes that gap by asking about effect: would revealing the information leave the client worse off? A frequent mistake is to reason that information is not privileged and may therefore be shared in a conflict check. The proviso joins its limbs with “or otherwise,” so clearing the first leaves the second still to be cleared.
Had the lawyer stopped at naming the chain as a former client and describing the lease matter in general terms, the new firm could have seen the adversity and dealt with it. Nothing in that description helps the supplier against the chain in the collection dispute, because the supplier already knows who its debtor is.
Sometimes even a bare name does damage.
When the proviso fails, (b)(7) supplies no permission, and the lawyer returns to the baseline of Rule 1.6(a): no disclosure unless the client gives informed consent, the disclosure is impliedly authorized in order to carry out the representation, or another exception applies.25 Implied authorization seldom fits, because showing a client’s name to a prospective merger partner does not carry out the client’s representation. The practical route is the client’s informed consent. If the client agrees, the disclosure rests on that consent and not on the exception. If the client declines, the check for that client cannot proceed on this route, and the firms must decide whether to go forward without it.
Even a disclosure that clears both limbs remains subject to Rule 1.6(c), which requires reasonable efforts to prevent the inadvertent or unauthorized disclosure of, or unauthorized access to, information relating to the representation.26 The duty forms no part of (b)(7)’s text, and it applies to every disclosure. In a conflict check it means the information goes only to those who run the check, through channels others cannot reach. A client list left on an open shared drive during merger talks is an unauthorized disclosure, though the exchange itself was permitted. Paragraph (b)(7) asks whether the lawyer may reveal; Rule 1.6(c) asks whether the lawyer protected what was revealed.
Fact patterns usually hide the error at step two or step three. A lawyer who explains away a conflict by retelling a confidential conversation fails step two, and a lawyer who shares a non-privileged but damaging fact fails step three. Step four is where an answer earns full credit, because it names both the fallback and the separate duty of care.