Saturday, July 19, 2008
Posted by Jeff Lipshaw
Call me a fool, but I like to get stuff out there as early as I can short of being humiliated (I am okay with merely embarrassed). I have wrestled now for four years on the precipice either of an practitioner who thought too much like a professor (actually, that accusation goes back a long time), or a professor who was tainted by so many years of practice. I think Tevye in Fiddler on the Roof spoke to this: "a fish could marry a bird, but where would they live?"
I've posted a short and preliminary essay that reflects what I've been thinking about and reading about over the summer, and it has to do with the theory and practice of judgment - how judgment differs as between clients and practicing lawyers, and in turn, how it differs between practicing lawyers and the professors who taught them. The piece is entitled Law's Illusion: Scientific Jurisprudence and the Struggle with Judgment. Here's the abstract:
Why are there two fairly clear chasms that affect practicing lawyers - one between themselves and their clients, and one between themselves and their professors? Both have to do with the irreducibility of judgment - perceiving regularities, applying rules to new situations, and deciding in advance what to do. I suspect Kant was right over two centuries ago, and there has not been much progress theorizing about it since then (even after the behavioral theorists like Tversky and Kahnemann and popular expositors like Malcolm Gladwell); judgment, either the inductive inferences from what we observe to what we generalize, or the leap from what we generalize to what to do next, is not teachable, but only achievable through practice. Practicing lawyers are reductivists in comparison to their clients - reducing the complex world through the "science" of law to a model; professors are reductivists in comparison to their students - either reducing the practice to a rational science, or avoiding the question of judgment at all.
This is a thought piece preliminary to a more detailed treatment of the idea.
(By the way, this is the first time I've posted a new piece on SSRN in a while; the system is improved, but still capable of being screwed up. Key advice: remember to click the "save" button to the upper right when you are done with each entry.)
Posted by Jeff Lipshaw
Some random observations this morning from up here in God's country. . . . (well, if David Broder could do it from Beaver Island thirty miles northwest in the middle of the lake, why can't I?)
- The front page of the Detroit Free Press has a story on the latest gaffe in the mayoral debacle, this time, the decision by Gov. Jennifer Granholm (D-Harvard Law School) apparently to try to broker a deal with the federal prosecutors to resolve the mayor's difficulties at the same time she may be called upon to remove him from office. Quoted in the article on the legal ethics angle is none other than our own Nancy Rapoport.
- They have begun to tear down vacant Tiger Stadium. See the New York Times.
- Reading the list of Starbucks closings to which Alan linked felt a little like going down a list of disaster victims. I knew the ones at 38th and Meridian and in The Precedent in Indianapolis. I used to stop at the first one on my way down to teach my entrepreneurship and the law seminar at IU-Indy, and the second one was the stop between the gym and my office at Great Lakes. Interesting that not a single store in Boston or Cambridge was closed. Here's a theory. Because of the significant competition in Boston from Dunkin' Donuts (I still don't get Dunkin' Donuts, particularly the abomination of having the servers put the cream in your coffee before they pour it, but Boston runs on Dunkin'), Starbucks never overbuilt.
- For those of you just dying to know the fate of yesterday's cherries, first they are pitted and sugared (see above left), and then they are consigned to a cherry crisp (right). We who merely climb the ladder to pick the cherries defer this latter highly technical activity to the experts.
- Humean dogs. My two dogs, Max and Annie, are constrained by an Invisible Fence. When somebody comes by walking a dog on the street in front of us, they run up and down barking furiously until the passersby are a couple feet beyond the lot line, and then they immediately stop. I have concluded they believe they are causing the passersby to go away.
Friday, July 18, 2008
A New York law firm was retained to assist the client in recovering her interest in a partnership. The firm secured a judgment against Julius Gerzof for over $1.2 million dollars. Gerzof died in Florida before the judgment had been satisfied. The firm hired Florida counsel to preserve the claim against Gerzof's estate. Florida counsel did not file a timely notice and the client "was unable to satisfy any of her judgment from the substantial assets of the estate." The client then sued the New York firm on a theory of vicarious liability for the mistake of Florida counsel.
The New York Appellate Division for the Third Judicial Department rejected the New York firm's contention that it had met its obligation to the client by retaining the Florida lawyer. While a firm is ordinarily not liable for the acts or omissions of a co-counsel outside the firm, here the New York firm solicited and hired Florida counsel without the client's knowledge. The client had no retainer agreement or contact with the Florida lawyer: "Under these circumstances, defendant assumed responsibility to plaintiff for the filing of the Florida estate claim and [the Florida lawyer] became defendant's sub-agent." Thus, summary judgment was properly denied to the New York firm. (Mike Frisch)
[posted by Bill Henderson, crossposted to ELS Blog]
The bi-modal distribution (graphic to the right, originally posted at ELS) continues to generate interest in the blogosphere. See, e.g., Greg Mankiw, Right Coast, Broken Symmetry. The chart summarizes the starting salaries for lawyers who graduated from law school in 2006. One reason the bi-modal structure is so jarring is that it demonstrates that measures of central tendency, such as average or median, are not necessarily reliable guides for law students' future earning power. In conventional labor markets, that disconnect is rare.
NALP recently dug into its archives to determine whether this stratification is a persistent feature of the entry level law market. See NALP Bulletin (Jan. 2008). It turns out that 15 years ago, the market followed a much more traditional distribution. The chart below summarizes the salaries for the class of 1991.
The 1991 graph is right skewed but bears some resemblance to a normal curve. Below is the graph for 1996:
The rightward skew is a bit more pronounced and the area under the $75K to $85K range is becoming more substantial. A more seismic shift is seen in 2000 (below) with the emergence of a second mode at the $125K price point.
At the height of the Internet boom, a remarkable 14% of all entry
level lawyers took jobs at the $125K level. According to NALP, "never
before had a single salary so dominated the landscape." Under the 2006
bimodal distribution (see chart above),
44% of graduates received entry-level salaries in the $40K to $60K
range; yet, the second mode moved further to the right ($135K to $145K) and
grew to 17% of all graduates.
What are the market forces that have created this peculiar salary structure? In my working paper, "Are We Selling Results or Résumés?: The Underexplored Linkage Between Human Resource Systems and Firm-Specific Capital,"
I posit that the runaway $160K mode is a confluence of two factors:
(1) the continued growth in the corporate legal services market,
primarily due to the growing scale and scope of transnational corporate
activity; and (2) law firms' nearly universal adherence to the "Cravath system,"
which purports to hire the best graduates from the best law schools and
provide them with the best training. More after the jump. ...
What are the market forces that have created this peculiar salary structure? In my working paper, "Are We Selling Results or Résumés?: The Underexplored Linkage Between Human Resource Systems and Firm-Specific Capital," I posit that the runaway $160K mode is a confluence of two factors: (1) the continued growth in the corporate legal services market, primarily due to the growing scale and scope of transnational corporate activity; and (2) law firms' nearly universal adherence to the "Cravath system," which purports to hire the best graduates from the best law schools and provide them with the best training. More after the jump. ...
The Illinois ARDC filed charges that were posted online today that allege neglect and related misconduct in the representation of a client in connection with a rental agreement. The most remarkable aspect of the allegations is the hourly fee, charged in 2005. The hourly rate is $40 per hour.
In unrelated amended charges also posted today, the allegations involve a wildly different amount of money. The lawyer, a shareholder in a law firm, is alleged to have breach fiduciary obligations to the firm's four other shareholders and clients. The amounts alleged to have been either commingled or converted appear to be well in excess of a million dollars. The lawyer also is alleged to have made false notations with respect to 99 check transactions in order to conceal his conduct from the other firm shareholders. (Mike Frisch)
Posted by Jeff Lipshaw
Over at Conglomerate, native Wisconsin cheese head Gordon Smith has been posting about his study of artisan cheese makers. I wish I had something blog-relevant to say about this, but here in northern lower Michigan, the big thing is cherries. At left you see a tub of these lovelies, tart Montmorency cherries picked from our cherry tree in front of the house (this morning, by yours truly, on an OSHA-compliant twelve-foot ladder) and now destined for a cherry crisp. (They are much redder than this picture makes them appear - my lousy cell phone camera.) If you happen to be in the neighborhood, feel free to stop by and pick a few yourself (hurry, the birds are eating them) after signing the appropriate waiver of liability.
An attorney who had been subject to public reprimands on two prior occasions was suspended for five months and ordered to make restitution to clients. The attorney's misconduct involved mishandling of two bankruptcy cases and a petition for postconviction relief in a criminal matter. The court concludes:
we agree with the referee that a 90-day suspension would be inadequate. By her own admission, Attorney Boyd has handled in excess of 1,000 bankruptcies in her legal career. The mistakes she made in handling the Mr. and Mrs. M. and V.J. bankruptcies were serious failings which caused her clients to incur unnecessary expenses. Attorney Boyd also misled C.B. and M.H. into believing she was experienced in handling postconviction criminal matters. We agree with the referee that the sanction imposed must be sufficient to impress upon Attorney Boyd the seriousness of her misconduct. We believe, however, that a five-month suspension, rather than the six months recommended by the referee, will accomplish this goal. We also agree with the referee's recommendation that Attorney Boyd be required to make restitution to her clients in the amounts detailed in the addendum to the referee's report, and that she be required to pay the full costs of the proceeding.
The reprimands involved (1) forging a clients name to a refund check and (2) commingling, incompetent representation and charging an excessive fee. (Mike Frisch)
In a fee dispute between two lawyers, the Nebraska Supreme Court reversed an order granting summary judgment. The court examined the agreement between the lawyers and concluded that the 75-25 fee split only applied to the trial fees. The lawyer who handled the appeal was entitled to the additional 10% recovered as fees without an obligation to share those fees with the other attorney. (Mike Frisch)
Thursday, July 17, 2008
An attorney who had claimed to represent a person without authority and engaged in a conflict of interest by representing the estate of an automoblie accident victim while also representing the person who had caused the accident in the related criminal matter received two reprimands from the Supreme Court of Washington.
A dissent decries the leniency and the majority's characterization of the misconduct as negligent. From the dissent:
Mark Stansfield is a long-time attorney in the small town of Quincy, Washington, where, in his own words, "a triple homicide is rare." Hearing Transcript (HT) at 122. After one such rare occurrence, Stansfield probated the estate of one of the decedents and
discussed a possible wrongful death claim with that decedent's widow. He
then represented the criminal defendant driver charged with causing the
fatalities. He also claimed to represent the impoverished Guatemalan-
residing widow of a different decedent for over three months without her
consent, even filing a lien for attorney fees against her husband's estate and
thus delaying her receipt of sorely needed insurance proceeds. Because the
majority holds Stansfield acted negligently, and not knowingly, and
accordingly reduces his penalties, I dissent.
The dissent would impose a six-month suspension, the sanction that had been proposed by the Disciplinary Board.
Question: may two reprimands be fairly characterized as a slap on both wrists?
If you are a student of bar discipline, you may have noted the importance of labels. Labels rule here--if you call the conduct negligent, you are free to impose a light sanction. If you call it intentional, a harsher result is required. This is particularly true in cases involving theft of client funds, where the intentional label often results in disbarment and a more favorable intent finding can draw much lighter discipline. (Mike Frisch)
In an unusual report recommending that both partners of a two-partner be disbarred, an Illinois hearing board described the firm:
Between 1998 and 2007, Respondent Roger H. Williams and Respondent Tracy Hensler Krizman were partners in the two-attorney law firm of Williams and Krizman. Respondents jointly handled all of the firm’s cases, sharing responsibility for communicating with clients and opposing counsel, filing and responding to motions on pending cases, and attending court dates. During that same time, attorney David Harrison, who concentrated his practice in the area of workers’ compensation claims, referred numerous clients to Respondents for the handling of their personal injury claims.
The board found instances of severe neglect in six matters and noted that each partner had a record of prior discipline. The board concludes:
Respondents have demonstrated a complete disregard for their professional responsibilities and for these proceedings. In light of their extensive pattern of misconduct, we are of the opinion that Respondents pose a significant danger to the public and will continue to cause great damage if allowed to practice. Keeping in mind the purposes of the disciplinary process, which are to safeguard the public from any future abuse by Respondents, to preserve the integrity of the legal profession, and to protect the administration of justice from reproach, we conclude that the most severe discipline should be imposed. Accordingly, we recommend that Respondents Roger H. Williams and Tracy Hensler Krizman be disbarred.
In a disciplinary case where the accused had "represented entities that invested and participated in a tax avoidance enterprise created by Walter J. Hoyt, III," the Supreme Court of Oregon today held that the Bar had failed to prove any ethical violations. The court's "conclusions rest on the Bar's failure to prove that [his client, Hoyt & Sons Master Limited Partnership ("MLP")] had the right to receive note payments from the investor partnerships and the accused knowingly made false statements about those notes and payments." The court also found the Bar's charges of conflicts of interest in multiple representations were not proven:
The Bar charges that the accused had a conflict of interest in undertaking representation of MLP because the interests of MLP and the investor partnerships were actually or potentially adverse and the accused nevertheless (1) simultaneously represented both; and (2) continued to represent the investor partnerships after he withdrew from his representation of MLP. As we will explain, we conclude that the interests of MLP and the investor partnerships were not actually adverse when the accused initially agreed to represent MLP in the Chapter 7 bankruptcy and that the accused appropriately advised his clients of the potential for conflict and obtained their consent to his continued representation.
The court summarizes the complex facts of the matter and finds that the accused did not knowingly make false statements. As to the conflicts charges:
When the accused learned, in late October 1997, that the interests of the investor partnerships and MLP had changed from interests that potentially could conflict to interests that did, by then, actually conflict, he renewed his motion to withdraw as attorney for MLP. After the bankruptcy court allowed the accused to withdraw, he continued to represent the investor partnerships in the Chapter 7 proceeding. DR 5-105(C) (1997) provided that a lawyer who has represented a client in one matter is prohibited from subsequently representing another client in the same matter when the interests of the current and former clients are in likely conflict, unless the lawyer obtains the client's consent after full disclosure from both the former client and the current client. According to the Bar, the accused's disclosure of the conflict that he concedes was likely was inadequate, because he did not reveal to the bankruptcy trustee, who represented the interests of MLP, that the investor partnerships had made payments to the accused and to Hoyt entities that instead should have been directed to MLP.
The Bar's argument is not well taken. A lawyer who recognizes a likely conflict is required to advise the client of the potentially adverse consequences of the multiple representation, not of all facts known to him that could be helpful to the former client. DR 10-101(B); see In re Brandt/Griffin, 331 Or 113, 135, 10 P3d 906 (2000) (lawyer must provide disclosure sufficient to apprise client of adverse consequences and permit independent counsel to assess the conflict). In the affidavit that the accused filed in support of his motion to withdraw, the accused notified the trustee of the nature of the conflict, i.e., that the interests of MLP and the investor partnerships could diverge and that he could not advocate for both. The trustee gave his consent to the accused's continued representation, because the trustee determined that it was essential that he have one representative of the investors with whom he could communicate, given that 2,500 individual investors could be affected by the bankruptcy proceeding. The trustee may have benefitted had the accused also disclosed information about payments by investors or investor partnerships that would have assisted him in marshaling MLP assets, but that is not information that the accused was required to disclose to comply with conflict of interest rules.
The court's conclusion:
Hoyt created and operated a fraudulent enterprise. For many years, the accused believed in the legitimacy of that enterprise and represented the partnerships that invested in it. The accused heeded the separate existence of those investor partnerships and each of the other entities that made up the Hoyt enterprise, including MLP. Ultimately, of course, the accused was wrong: The enterprise was not legitimate in either substance or form. But it took from February to November 1997 for the accused to understand that reality. That the accused did not act as promptly as he should have to disassociate himself from Hoyt and other aspects of his conduct in connection with the Hoyt matters are not above criticism. However, the Bar did not prove by clear and convincing evidence that the accused committed the ethical violations that it charges. We therefore dismiss the complaint in its entirety.
It is quite unusual to see a disciplinary case work its way to a state high court and result in a complete vindication of the accused lawyer. Note that it took over three years to resolve the case. Two of the three-member panel sustained the false statement-related charges and recommended public reprimand. The third member found no ethical misconduct, the position ultimately adopted by the court here. (Mike Frisch)
The Minnesota Supreme Court ordered an attorney indefinitely suspended for a minimum of six months. The attorney and his wife had emigrated from Ethiopia and he was admitted in 2001, focusing on personal injury law. The wife sought a civil protection order against him; he denied that any abuse had taken place. He then sued three former friends for defamation, alleging that they had encouraged the wife to seek the protection order. The court dismissed the action but did not impose sanctions on the lawyer.
Two years later, the bar received notice of a trust account overdraft. The wife met with an attorney who was conducting the bar investigation. Charges of trust account violations were filed and admitted, but the lawyer denied misconduct in the defamation case and denied that he had filed a false affidavit concerning the alleged abuse. The wife, her mother and her daughter testified in the bar case. The referee found the other charged violations.
On review, the court held that evidence concerning the spousal relationship was relevant and properly admitted on the issue of whether or not the lawyer had falsely denied the abuse and as impeachment. The proposed sanction was appropriate for negligent misappropriation and lack of truthfulness and candor. (Mike Frisch)
Hat tip to the ABA Journal for their post about judicial misconduct charges filed against a judge of the Allen Superior Court in Indiana. It is alleged that the judge attended a court proceeding in the courtroom of another judge "wearing his judicial robe." When the sentencing of a defendant was concluded, it is alleged that the judge approached the prosecutor and "created a disturbance." Choice quotes alleged: "Upstanding citizen, my ass!" To the defendant's parents: "Are you related to that piece of shit?" (Mike Frisch)
The Wisconsin Supreme Court approved a stipulated 60 day suspension with restitution in a matter that arose in the wake of the attorney's earlier temporary suspension for failure to cooperate with a disciplinary investigation. While suspended, the attorney appeared in four client matters, performing legal services on a contract basis for the State Public Defender. The stipulated charges involved unauthorized practice and dishonesty "by misleading the Jefferson County clerk of the circuit court about her license status..."
In an unrelated matter, the court reinstated an attorney who had been suspended for six months as a result of improper and undocumented billings to the public defender for work as a contract attorney. (Mike Frisch)
An Arizona attorney found in violation of ethics rules in 2004 went on inactive status in 2005. The attorney was asked to but declined to sign a probation contract on return to active status and refused to sign a consent form providing access to medical treatment records, although one report was received indicating that the attorney was "improving." A probation violation hearing was held, at which the attorney refused to testify on advice of counsel.
The hearing officer's report recommended that the attorney be subject to a three-month suspension: "[the attorney's] lack of respect for the hearing conducted...is fortified by her unwillingness to testify, her demeanor at the hearing, and her cynical approach and attitude to this hearing." The recommendation provided for an increase of the suspension to six months and a day if the attorney continued her non-compliance with probation conditions.
The Disciplinary Commission recently recommended the longer suspension. Noting the attorney's claim of disability based on bipolar disorder, the commission concludes that the attorney "should be required to participate in formal reinstatement proceedings and provide comprehensive medical records, including an independent medical examination, to prove...rehabilitation and fitness to practice."
The matter now proceeds to the Arizona Supreme Court for final action. (Mike Frisch)
The District of Columbia Court of Appeals disbarred and ordered restitution in a matter where the attorney had a client representative sign over a check in excess of $241,000 to him. The court accepted a Board on Professional Responsibility (the board recommendation is appended) finding that the lawyer was aware that he was not entitled to a significant amount of the funds at issue. The board and court rejected the attorney's asserted good faith "claim of right" to the funds. The court also rejected the assertion that an unproven charge of forgery had somehow tainted the proceedings below, but cautioned Bar Counsel to carefully investigate a serious claim of that nature in the future. Restitution is a condition of reinstatement. (Mike Frisch)
Wednesday, July 16, 2008
The Legal Ethics Committee of the District of Columbia Bar has recently issued an opinion that discusses the ethical implications of lawyers who engage in lobbying activities. The committee concludes as follows:
Most of the conflict rules apply to lawyer-lobbyists engaged in lobbying. Lawyer-lobbyists in the District of Columbia who hold themselves out as lawyers may not advance opposing positions in the same lobbying matter even with consents from all of their lobbying clients. Moreover, the lawyer-lobbyist must also ensure that she is not placing herself in a position where she might have to pull her punches on behalf of one client so as to protect the interests of another. Such conflicts can be waived with informed consent from the affected clients, provided that the lawyer reasonably believes that he or she can provide competent and diligent representation. Absent special circumstances, all of these restrictions also apply to other lobbyists in the same law firm, even if those other lobbyists are not themselves lawyers.
Lawyer-lobbyists are not, however, generally subject to Rule 1.7(b)(1) in the conduct of lobbying activities. This rule is confined to “matter[s] involv[ing] a specific party or parties,” a phrase that excludes lobbying, rulemaking and other matters of general government policy. As a result, Rule 1.7(b)(1) does not prohibit a lawyer-lobbyist from advancing a position in a lobbying matter that may be opposed in that same lobbying matter by another client of the lawyer-lobbyist (or of the lawyer-lobbyist’s law firm) where the other client is unrepresented in the lobbying matter or is represented by a different lobbyist who is not associated with the lawyer-lobbyist’s firm.
Finally, Rule 5.7 provides guidance for lawyers and law firms who wish to establish a law-related lobbying practice that is not governed by the conflicts provisions of the Rules of Professional Conduct. To do so, however, the lobbying client must receive clear notice that the services are not legal services and that the usual protections accompanying a client-lawyer relationship do not apply.
Of course, opinions of the ethics committee do not constitute binding precedent in the District of Columbia. However, an attorney who in good faith follows the articulated advice could assert reliance to show an intent to comply with ethical obligations. (Mike Frisch)
Posted by Alan Childress
Three articles recently posted to SSRN's Law & Soc'y: The Legal Prof'n journal (edited by Bill Henderson) are tangentially related but certainly on topic for this blog. One is from 2002 while in the midst of debates over truth, disclosure, and Enron [see also the recent take by Fred Zacharias on lawyering "truth" and lying to courts, as discussed at Legal Ethics Forum here and linked in full here]:
-- Steven H. Resnicoff (DePaul), "Lying and Lawyering: Contrasting American and Jewish Law."
Originally in Notre Dame Law Review, Vol. 77, No. 3, in 2002.
-- Eli Wald (Denver), "The Rise and Fall of the WASP and Jewish Law Firms." Forthcoming in Stanford Law Review.
-- Eli Wald (Denver), "The Rise of the Jewish Law Firm or is the Jewish Law Firm Generic?" Forthcoming in University of Missouri-Kansas City Law Review.
Other recent postings to SSRN: see also some explorations published in this SSRN journal on the idea of transnational legal education, and more on the "globalization of law firms" here and here. Finally, Placido Gomez, from Stetson, posted this provocative title, "White People Think Differently," a paper he published in 1991 on minority pass rates on bar exams.
July 16, 2008 in Abstracts Highlights - Academic Articles on the Legal Profession | Permalink | Comments (0) | TrackBack (0)