Wednesday, January 25, 2023

Client Identity Gamble

A recent decision of the New Jersey Appellate Division is summarized below

Defendants – an attorney and law firm – have a client that produced a report, which asserts plaintiffs unlawfully conducted gambling-related business in forbidden countries. At the client's behest, the defendant attorneys forwarded the report to the New Jersey Division of Gaming Enforcement. When the media learned of the report, plaintiffs sued the defendant attorneys, as well as their anonymous client and other fictitious persons, alleging defamation and other torts. Plaintiffs successfully obtained an order compelling the defendant attorneys to provide their client's identity. The court granted the defendant attorneys' motion for leave to appeal.

Although RPC 1.6 generally imposes on attorneys the ethical obligation to refrain from disclosing a client's identity without the client's consent, the court held that this interest in preserving confidentiality cannot be used to thwart justice and, in appropriate circumstances, a client's right to anonymity may be overcome in favor of an injured party's right to seek redress in our courts. To resolve the conflict between these interests, there must be a deeper examination of the claim's merits than occurred here. The court, therefore, vacated the disclosure order and remanded for the judge's inquiry into the veracity of the report that lies at the heart of plaintiffs' civil action, leaving to the judge's discretion the methodology to be employed.

From the opinion

Because the precise nature of the information sought is not readily apparent, we decline the invitation to decide whether or how the informant's privilege or the work-product doctrine may apply to the discovery requests in question. Instead, we focus on the battle here that pits an attorney's obligation to avoid revealing a client's identity against a litigant's right to the discovery of information necessary for its pursuit of a civil cause of action. In achieving an appropriate balance between these important societal interests – and the ultimate judicial interest in the pursuit of the truth of the parties' assertions – we conclude that the revelation of the client's identity, if at all discoverable, must await a better understanding of the weight of plaintiffs' causes of action, which seem to greatly, if not exclusively, turn on the Report's veracity.

The court declined to adopt the "absolutist" positions of either side

In short, we are satisfied that somewhere between the parties' polar opposite positions lies a middle ground where the client's desire for anonymity does not entirely eviscerate another's valid cause of action or, stated the other way, where a civil claim may not be of sufficient weight to overcome the strict policy interests underlying RPC 1.6's general rule of nondisclosure. Although Advisory Opinion No. 544 dealt with quite a different circumstance than presented here, the Court's decision makes clear that there may be instances when some degree of disclosure may be warranted.

Remand required

we leave to the trial judge's discretion the best way to proceed. What is required need not be elaborate. The judge may or may not decide that an evidentiary hearing would be helpful. It may be that some abbreviated discovery – perhaps allowing plaintiffs to depose the defendant attorneys and explore what it is they did and what they considered in finding the Report credible – may go a long way in providing the judge with greater clarity about the Report's veracity, which seems to be the key to the success or failure of plaintiffs' suit. Or, it may be – considering the DGE and its Pennsylvania counterpart have had the Report for over a year – that their investigations have yielded, or may soon yield, sufficient enlightenment about the Report's veracity. Perhaps, some other approach – standing alone or in combination with those we have suggested – may provide an expeditious path toward fulfilling our mandate. The judge should also consider whether or to what extent information should be received and reviewed in camera as the means for best protecting the client's anonymity until a ruling on disclosure may be made.

(Mike Frisch)

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