Friday, August 1, 2008

Bauer on Secret Settlements

Jon Bauer (Connecticut) has recently posted an important article on SSRN on the ethics of settlements that impede other parties' access to evidence entitled "Buying Witness Silence: Evidence Suppressing Settlements and Lawyers' Ethics."  This issue is relevant to the civil rights context and products liability.  Here is the abstract:

Lawyers frequently draft settlements that impede other parties' access to relevant evidence, through clauses that prohibit the plaintiff from making voluntary disclosures to anyone with a claim against the defendant, or forbid all uncompelled disclosures concerning the facts underlying the dispute. This Article argues that lawyers who negotiate these "noncooperation" agreements violate Rule 3.4(f) of the Model Rules of Professional Conduct, which prohibits requesting someone other than the lawyer's own client to withhold relevant information from another party, and Model Rule 8.4(d), which prohibits "conduct that is prejudicial to the administration of justice."

The conventional wisdom among practitioners and legal ethics scholars has been that lawyers may ethically negotiate any settlement terms that serve their clients' interests and are not criminal or fraudulent. (Some recent critics of settlement secrecy have argued that noncooperation settlements violate obstruction of justice statutes or other criminal laws, but the illegality argument is largely unconvincing.) This Article argues that the conventional view has looked at the problem through the wrong lens. In the ethos of the ethics codes, third party and societal interests generally take a back seat to client service, but certain types of conduct deemed especially harmful to the justice system have long been placed off-limits to lawyers because of their special role as "officers of the court."

This Article traces the history of one such duty, the principle that lawyers must not ask nonclients to refrain from voluntarily disclosing relevant information to other parties or their attorneys, and shows the important function that it plays in safeguarding the integrity of adversary adjudication. After providing a theoretical justification for liberally construing ethics rules that limit client advocacy for the sake of the adversary system's effective functioning, this Article explores what the rules mean for settlement practices. The Article examines how far the duty to allow disclosures of relevant information to other parties extends; the scope of the exception allowing noncooperation requests to be made to a client's employees; whether it is permissible to require that certain types of information, such as settlement amounts, discovery materials, privileged information, and trade secrets, not be disclosed; and what limits may be placed on the manner of disclosure. The conclusion addresses the critique that prohibiting lawyers from negotiating agreements that their clients could lawfully enter into on their own is either futile or paternalistic, and shows that it is neither.


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As a practicing attorney, I can attest to this however, it should be kept in mind that the whole purpose of settling is also to grant the Defendant with a certain measure of protection. If all details were to leaked out whats the Defendant's incentive to settle??

Posted by: Francis | Aug 1, 2008 12:46:15 PM

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