In late 2018 California, for the first time, specifically set forth the duties lawyers owe to potential clients by the inclusion of Rule 1.18 in the new Rules of Professional Conduct. Under the new rule, a lawyer owes the same duty of confidentiality to a potential client as that owed to an existing or former client under Rules 1.6 and 1.9, even though no lawyer-client relationship later forms. This means that a lawyer may not, without informed written consent, represent another party in the same or a substantially related matter where the interest of that party and the potential client are materially adverse. (Rule 1.9(a); Rule 1.18(b).) It also means that, even where there is no subsequent conflicting representation, a lawyer may not use or disclose information gained from the prospective client without the prospective client’s informed written consent. (Rule 1.6(a); Rule 1.9(c); Rule 1.18(b).) This is true even if the information would be material to the representation of an existing client of the lawyer or the lawyer’s law firm. The duty of confidentiality to the prospective client outweighs the duty to inform the current client.
In 2021, the California Committee on Professional Responsibility and Conduct (COPRAC) published formal opinion 2021-205, analyzing in detail the new rule and issues which may arise, including a detailed analysis of screening procedures under Rule 1.18(d) that can be implemented to avoid disqualifying an entire firm because of one lawyer’s conflict. While screening is beyond the subject of this brief article, all lawyers would do well to read the opinion.
One practical issue which all lawyers should take into account when talking with prospective clients is how to ensure that conflict checks are properly performed not just for former and current clients, but also prospective clients. It is easy to envision a scenario of a two-lawyer firm where one partner has a brief 15-minute phone call with a prospective client, and the other partner then has a similar call with the prospective client’s adversary. Unless procedures are in place to allow for a full conflict check, it could be easy to miss the conflict until much later in the representation. Once the non-retaining prospective client realizes that the law firm represents his or her adversary, the law firm is in danger of disqualification.
The simplest way to protect against this possibility is to ensure that each prospective client, no matter how quick an intake call or email, is logged into a system for conflict checks and identified as a prospective client. Then, when conflict checks are performed, the name will come up just like it would for any other current or former client. One final suggestion for handling prospective clients: always make sure to write a non-retention letter if the consult does not result in retention. These letters (or emails) serve to avoid any confusion and are a simple and efficient risk management tool.