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Ethics FAQ


 FREQUENTLY ASKED QUESTIONS
Posted June, 2010

A review of the inquiries made to the Committee’s Ethics Hotline has shown that certain questions occur more often than others.  Accordingly, the Committee has prepared a set of answers to frequently asked questions for the general edification of the Bar.  The answers provide only an introduction to the topics discussed.  Before taking any action, a lawyer should conduct more extensive research, consulting at a minimum relevant court decisions, the Committee’s formal opinions, and the opinions of the Professional Ethics Committees of the New York State Bar Association, the New York County Lawyers' Association, and the Nassau County Bar Association.
 

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 SIMULTANEOUS REPRESENTATION OF MULTIPLE CLIENTS
Q. M ay a lawyer simultaneously represent multiple clients with conflicting interests?

A. Rule 1.7 of the New York Rules of Professional Conduct ("Rules"), 22 N.Y.C.R.R §1200.7, governs the answer to this question.

Rule 1.7(a) provides in pertinent part that except as permitted by Rule 1.7(b) (discussed below), “a lawyer shall not represent a client if a reasonable lawyer would conclude that . . . the representation will involve the lawyer in representing differing interests.” Rule 1.7(a)(1).

Even when two or more clients have “differing interests,” the affected clients may be able to waive the conflict and consent to the attorney’s simultaneous representation. Such waiver and consent are effective if three conditions are met:

  1. the lawyer reasonably believes that she will be able to provide competent and diligent representation to each affected client;
  2. the representation is not prohibited by law; [and]
  3. the representation does not involve the assertion of a claim by one client against another client represented by the lawyer in the same litigation or other proceeding before a tribunal. . . .

Rule 1.7(b).

If these conditions are satisfied, a lawyer may simultaneously represent clients notwithstanding a conflict only if “each affected client gives informed consent confirmed in writing.” Rule 1.7(b)(4).

Absent consent, when a lawyer represents a client in one matter, he may not be adverse to that client in a different matter, even if the two matters are wholly unrelated. See Rule 1.7, Cmt. [6].

Rule 1.8 provides an additional caveat for attorneys involved in representing multiple clients simultaneously. “A lawyer who represents two or more clients shall not participate in making an aggregate settlement of the claims of or against the clients, absent court approval, unless each client gives informed consent in a writing signed by the client.” Rule 1.8(g). See also N.Y. City 2009-6 (before binding multiple clients to an aggregate settlement, a lawyer has a nonwaivable obligation to obtain the informed consent of every affected client).

With respect to aggregate settlements, Rule 1.8 (g) further provides that informed client consent requires disclosure to each client of “the existence and nature of all the claims involved and of the participation of each person in the settlement.” In addition, Rule 1.8 requires that consent to the aggregate settlement be “in a writing signed by the client.” In contrast, under Rule 1.7, the requisite consent need only be “confirmed in writing,” as defined by Rule 1.0(e).

Rule 1.0 defines various terms used in Rules 1.7 and 1.8 as follows:

Confirmed in Writing

“Confirmed in writing” denotes (i) a writing from the person to the lawyer confirming that the person has given consent, (ii) a writing that the lawyer promptly transmits to the person confirming the person's oral consent, or (iii) a statement by the person made on the record of any proceeding before a tribunal. If it is not feasible to obtain or transmit the writing at the time the person gives oral consent, then the lawyer must obtain or transmit it within a reasonable time thereafter. (Rule 1.0(e))

Differing Interests

“Differing interests" includes every interest that will adversely affect either the judgment or the loyalty of a lawyer to a client, whether it be a conflicting, inconsistent, diverse, or other interest. (Rule 1.0(f))

Reasonable or Reasonably

“Reasonable” or “reasonably,” when used in relation to conduct by a lawyer, denotes the conduct of a reasonably prudent and competent lawyer. When used in the context of conflict of interest determinations, "reasonable lawyer" denotes a lawyer acting from the perspective of a reasonably prudent and competent lawyer who is personally disinterested in commencing or continuing the representation. (Rule 1.0(q))

Reasonable Belief

“Reasonable belief” or “reasonably believes,” when used in reference to a lawyer, denotes that the lawyer believes the matter in question and that the circumstances are such that the belief is reasonable. (Rule 1.0(r))

Informed Consent

“Informed consent” denotes the agreement by a person to a proposed course of conduct after the lawyer has communicated information adequate for the person to make an informed decision, and after the lawyer has adequately explained to the person the material risks of the proposed course of conduct and reasonably available alternatives.

The prohibition against conflicts in the representation of multiple clients furthers a number of salutary objectives. As explained by the New York Court of Appeals, the prohibition

safeguard[s] against not only violation of the duty of loyalty owed the client, but also against abuse of the adversary system and resulting harm to the public at large.

Greene v. Greene , 47 N.Y.2d 447, 451 (1979) (citations omitted).

An attorney who has failed to recognize or ignores the existence of an impermissible conflict involved in the simultaneous representation of multiple clients may be disqualified from representing all of the clients. “‘[A]n attorney who undertakes the joint representation of two parties in a lawsuit [should] not continue as counsel for either one after an actual conflict of interest has arisen’ because continued representation of either or both parties would result in a violation of the ethical rule requiring an attorney to preserve a client's confidences or the rule requiring an attorney to represent a client zealously.” Sidor v. Zuhoski, 261 A.D.2d 529, 530 (2d Dep't 1999) (quoting In re H. Children, 160 Misc. 2d 298, 300 (Fam. Ct. 1994)) (citation omitted). Multiple representation can therefore cause serious hardship to one or more clients if a lawyer is forced to withdraw after having performed significant legal services. (The same is true for unforeseeable conflicts "thrust upon" an attorney, through no fault of the lawyer, in the course of representing two or more clients. If such a conflict arises and the clients refuse to consent to simultaneous representation, the lawyer must withdraw from representing one or more of the clients. See N.Y. City 2005-5.)
 
Before representing multiple clients with actual or potentially conflicting interests, a lawyer must adequately explain to each client the implications of the common representation and otherwise provide information sufficient to permit each client to appreciate the significance of the potential conflict and its possible effect on the attorney’s ability to exercise independent professional judgment on behalf of the clients. The lawyer should accept or continue employment only if each client consents to the representation. See Anderson v. Nassau County Dep't of Corrections, 376 F. Supp. 2d 294, 299 (E.D.N.Y. 2005) (holding that an attorney has an affirmative obligation to disclose and explain a conflict and to obtain consent). The sophistication of the client is a factor in determining the effectiveness of the client’s consent. See N.Y. City 2001-2 (“A client represented by other counsel or in house counsel in connection with the waiver may more readily comprehend the possible effects on loyalty and confidentiality of the simultaneous adverse representation. To be sure, sophisticated corporate and institutional clients can consent to conflicts which might be non-consentable in cases involving unsophisticated lay clients who are not represented by independent counsel in connection with the consent.").

It may be easier to obtain waivers of conflicts in a non-litigation context than in the context of litigation. See id. (“[A] lawyer may represent one client in a transaction with a concurrent client in another matter, with disclosure and informed consent, so long as a ‘disinterested lawyer would believe that the lawyer can competently represent the interests of each.’ A lawyer may also represent multiple parties in a single transaction where the interests of the represented clients are generally aligned or not directly adverse, with disclosure and informed consent, so long as the ‘disinterested lawyer’ test is satisfied. Satisfaction of the ‘disinterested lawyer’ test in a non-litigation context will depend on an evaluation of the circumstances of the simultaneous representations. . . .”).1

A lawyer's possession of confidential information of one client that may be relevant to a matter the lawyer is handling for another client does not automatically create a conflict of interest. The existence or absence of a conflict will depend on whether the lawyer is able to avoid using one client’s confidential information in the representation of another client and whether possession of that information may reasonably affect the lawyer’s independent professional judgment in the representation of the other client. See N.Y. City 2005-2.

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SUCCESSIVE ADVERSE REPRESENTATION

Q. When may a lawyer represent a client with interests adverse to those of a former client?

A. Successive representation is permitted when there is no conflict between the interests of the former and current clients (under Rule 1.9) or when written waiver of the conflict has been obtained. Under Rule 1.9, all conflicts arising out of successive adverse representation may be waived by “informed consent, confirmed in writing” by the former client. But see N.Y. State 829 (oral waivers obtained before April 1, 2009 need not subsequently be confirmed in writing).

Where successive representation is permitted, Rule 1.9 requires attorneys to refrain from disclosing the confidences of their former clients or otherwise using them to the disadvantage of those clients. The following discussion pertains to lawyers in private practice only. Rule 1.11 governs conflicts involving government lawyers and should be consulted for guidance in addressing conflicts in those circumstances.

Prior representation, “Substantially related” and “materially adverse”

In some instances, there may be a threshold question of whether there has been a prior representation, i.e., whether the attorney “formerly represented” a person as a client in an earlier matter. SeeWorld Hill Ltd. v. Saar, No. 116916/07, 2009 NY Slip Op. 52289U, at *4 (N.Y. Sup. Ct. Nov. 6, 2009) (finding no conflict under 1.9 where no attorney-client relationship was formed in the prior, allegedly substantially related matter). In World Hill, the court denied a disqualification motion based on an alleged prior representation, holding that “[i]t is well settled that ‘[t]o determine whether an attorney-client relationship exists, a court must consider the parties’ actions. An attorney-client relationship is established when there is an explicit undertaking to perform a specific task. While the existence of the relationship is not dependent upon the payment of a fee or an explicit agreement, a party cannot create the relationship based on his or her own beliefs or actions'." Id. at *3 (quoting Pelligrino v. Oppenheimer & Co., 49 A.D.3d 94, 99 (1st Dep't 2008)) (second alteration in original).

The second inquiry is whether the current and prior representations involve the same or a “substantially related matter.” See Rule 1.9(a), 1.9(b). The comments to Rule 1.9 explain that “[m]atters are substantially related” if they involve the same transaction or legal dispute or if, under the circumstances, a reasonable lawyer would conclude that there is otherwise a substantial risk that confidential factual information that would normally have been obtained in the prior representation would materially advance the client’s position in the subsequent matter. See Rule 1.9, Comment [3]. The comments further note that the passage of time may be relevant in determining whether matters are substantially related, as “[i]nformation acquired in a prior representation may have been rendered obsolete.” Id. Moreover, information that has been disclosed to the public or other adverse parties “ordinarily will not be disqualifying.” Where a client is an organization, “knowledge of specific facts . . . relevant to the matter in question” will generally preclude representation, while “general knowledge of the client’s policies and practices” will not. Id.

A third consideration is whether the former client’s “interests are materially adverse” to those of the prospective client. Rule 1.9(a), 1.9(b)(1). This is also a fact-specific inquiry. See e.g., Tekni-Plex, Inc. v. Meyner & Landis, 89 N.Y.2d 123 (1989) (holding that interests of acquired corporation were materially adverse to interests of selling shareholder in a post-sale dispute regarding the corporation's pre-sale environmental compliance).

There is no prohibition or restriction on successive adverse representations involving unrelated matters or related matters where the interests of the former and current clients are not materially adverse.

The Individual Lawyer's Role in the Prior Matter

If both the “substantially related” and “materially adverse” prongs are satisfied, a lawyer must next consider the extent of her involvement or connection to the prior matter. Pursuant to Rule 1.9(a), where the lawyer herself has represented the former client, she may not take on the new matter unless the former client “gives informed consent, confirmed in writing.” Moreover, pursuant to Rule 1.10, Imputation of Conflicts of Interest, no lawyer associated with the conflicted lawyer may accept the engagement. Rule 1.10(a) ([w]hile lawyers are associated in a firm, none of them shall knowingly represent a client when any one of them practicing alone would be prohibited from doing so by Rule . . . 1.9, except as otherwise provided therein”).

To obtain the informed consent required by the rule, a lawyer must adequately explain to the former client "the material risks of the proposed course of conduct and reasonably available alternatives.” Rule 1.0(j).

Confirmation in writing must be obtained or transmitted “at the time the person gives oral consent” or “within a reasonable time thereafter.” Rule 1.0(e). This confirmation can take one of several forms under the rules:

(i) a writing from the person to the lawyer confirming that the person has given consent,

(ii) a writing that the lawyer promptly transmits to the person confirming the person’s oral consent, or

(iii) a statement by the person made on the record of any proceeding before a tribunal.

Rule 1.0(e).

A “writing” under the rules denotes a “tangible or electronic record of a communication” and broadly includes “handwriting, typewriting, printing photocopying, photography, audio or video recording and email.” Rule 1.0(x).

Switching Firms

Conflict issues involving successive adverse representation often arise after a lawyer switches firms and her prior law firm represented a client adverse to a current or prospective client of her new firm.

This situation requires examination of the lawyer’s involvement in the prior law firm’s representation of the former client in order to determine whether the former client’s informed consent is necessary to permit the lawyer and/or her new firm to continue representing a current client or to undertake the representation of a new client. See Silver Chrysler Plymouth, Inc. v. Chrysler Motors Corp. 518 F.2d 751, 756 (2d Cir. 1975) ( construing the predecessor rule; the test differentiates between "lawyers who become heavily involved in the facts of a particular matter and those who enter briefly on the periphery for a limited and specific purpose relating solely to legal questions.").

Rule 1.9(b) provides that where “a firm with which the lawyer formerly was associated had previously represented” the former client and "the lawyer had acquired” confidential information, as specified in Rule 1.6 and Rule 1.9(c), discussed supra, the lawyer may not engage in a subsequent “substantially related” and “materially adverse” representation unless the former client “gives informed consent confirmed in writing.”

Moreover, where the newly-associated lawyer is barred from the representation, the lawyer's firm is too. Pursuant to the imputation provisions of Rule 1.10(c), “[w]hen a lawyer becomes associated with a firm, the firm may not knowingly represent a client in a matter that is the same as or substantially related to a matter in which the newly associated lawyer, or a firm with which that lawyer was associated, formerly represented a client whose interests are materially adverse to the prospective or current client, unless the newly associated lawyer did not acquire any information protected by Rule 1.6 or Rule 1.9(c) that is material to the current matter.”

Lawyer’s obligations if representation is permitted and undertaken.

Where a successive representation is permitted, certain obligations to a former client remain. Under Rule 1.9(c)(2), a lawyer may not reveal confidential information of the former client protected by Rule 1.6 except as the Rules otherwise permit or require with respect to a current client.

(Emphasis added.) “Confidential information,” as defined by Rule 1.6, is not limited exclusively to privileged information, but rather

consists of information gained during or relating to the representation of a client, whatever its source, that is (a) protected by the attorney-client privilege, (b) likely to be embarrassing or detrimental to the client if disclosed, or (c) information that the client has requested to be kept confidential.

Rule 1.6. Rule 1.9 not only prohibits the disclosure of this information, it also provides that a lawyer may not

use confidential information of the former client protected by Rule 1.6 to the disadvantage of the former client, except as these Rules would permit or require with respect to a current client or when the information has become generally known.

Rule 1.9(c)(1) (emphasis added.) See alsoJamaica Pub. Serv. Co. v. AIU Ins. Co., 92 N.Y.2d 631, 637-38 (1998) (noting exception to client information that is generally or publicly known under former DR 5-108(A)(1).) The prohibition against use of confidential information remains fully applicable even if the lawyer is able to use the information without disclosing it to others.

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WITHDRAWAL AND THE RETENTION OF CLIENT FILES WHEN A CLIENT FAILS TO PAY THE LAWYER'S FEES

Q. When a client fails to pay its legal bills, may a lawyer withdraw from the representation, and if so, how? Can the lawyer retain the file until the bills are paid? Even after bills are settled, may a lawyer refuse the client access to portions of the file?

A. General summary. A lawyer generally may withdraw from the representation when the client fails to pay the lawyer's fees, but must take steps to the extent reasonably practicable to avoid foreseeable prejudice to the rights of the client. See Rule 1.16(c)(5), (e). In litigation proceedings, court rules commonly require consent of court before withdrawing. The exercise of retaining liens has been approved as an ethical matter, but their precise contours are questions of law, not ethical command. The client is presumptively afforded full access to the attorney’s entire file, with narrow exceptions.

Deliberate disregard of fee agreement required . Rule 1.16(c)(5) provides:

Except as stated in paragraph (d), a lawyer may withdraw from representing a client when . . .

(5) the client deliberately disregards an agreement or obligation to the lawyer as to expenses or fees. . .

Rule 1.16 (c)(5).

The requirement that the client "deliberately disregard" an obligation to pay fees and expenses means that the failure must have been conscious, not inadvertent, and not de minimis in either amount or duration. See N.Y. State 598 (1989). In that connection, a number of courts and ethics opinions have found that prior to withdrawal for nonpayment of fees, a lawyer first must ask the client to honor her payment obligations and warn the client that the lawyer will withdraw unless the fees are paid. See ABA/BNA Lawyers' Manual on Professional Conduct 31:1108 (2006); see also N.Y. State 598 (1989) (attorney must provide "clear notice to the client of the attorney's desire to withdraw"). In addition, when a client has a bona fide dispute with her lawyer regarding the amount of the fees due and owing, some courts have suggested that the dispute should not be regarded as a deliberate disregard of the client's obligations. See Dar v. Nadel & Assocs., P.C., 2004 N.Y. Slip Op. 51390(U), at *4 (N.Y.City Civ. Ct. Kings County No. 3379/04, 2004), available at 2004 WL 2624612 (“[d]isputing the amount owed is not a refusal to pay”).

Duties upon withdrawal . Where withdrawal is permitted, the Rules provide that

upon termination of representation, a lawyer shall take steps, to the extent reasonably practicable, to avoid foreseeable prejudice to the rights of the client, including giving reasonable notice to the client, allowing time for employment of other counsel, delivering to the client all papers and property to which the client is entitled, promptly refunding any part of a fee paid in advance that has not been earned and complying with applicable laws and rules.

Rule 1.16(e).

Further, in litigation matters, permission of court is required as a matter of course under applicable rules of procedure, seee.g., N.Y. C.P.L.R. 321(b), which are incorporated into the Rules. See Rule 1.16(d) ("If permission for withdrawal from employment is required by the rules of a tribunal, a lawyer shall not withdraw from employment in a matter before that tribunal without its permission. When ordered to do so by a tribunal, a lawyer shall continue representation notwithstanding good cause for terminating the representation.").

Retaining liens . Retaining liens provide certain rights to retain, until the lawyer's fees and expenses are paid, a client's papers, money, and other property that have come into the lawyer's possession in the course of the lawyer's professional employment. Ethics opinions have approved the exercise of a retaining lien to the extent such a lien is permitted by law. See, e.g., N.Y. City 82-74 (file); N.Y. State 567 (1984) (money); N.Y. County 678 (general but restricted right); Nassau County 90-5 (wills while client is alive); see also Rule 1.15(c)(4) (requiring return of property "that the client … is entitled to receive"); Rule 1.8(i)(1) (charging liens permitted).

“Because the retaining lien is such a powerful weapon, both ethics committees and courts have placed limitations on the circumstances in which it can be exercised.” N.Y. County 678; see also Shoe Show, Inc. v. Launzel, No. 92-CV-2794, 1993 WL 150322, at *1 (E.D.N.Y. May 3, 1993) (“An exception to the attorney's right to a retaining lien may be found, in the court's discretion, where the client has made a clear showing of: (1) a need for the documents, (2) prejudice that would result from the denial of access to the papers, and (3) inability to pay the legal fees or post a reasonable bond”). The precise scope of a lawyer's right to assert a retaining lien presents questions of law. See N.Y. City 82-74. See generally ABA/BNA Lawyers' Manual on Professional Conduct 41:2102-2111 (1992); Rotker v. Rotker, 195 Misc. 2d 768, (N.Y.Sup. Ct., Westchester County 2003).

Counsel retained by insurance company . A number of courts have held that where counsel is retained by the client's insurance carrier and the carrier fails to pay counsel, counsel's rights to withdraw and exercise a retaining lien may be more limited than when the client alone is responsible for, but does not pay, the attorney's fees. SeeDennis v. Young, 106 A.D. 2d 762, 763 (3d Dept. 1984) (counsel could not withdraw at least until dispute over coverage decided); Turzio v. Ravenhall, 34 Misc. 2d 17, 18 (N.Y. City Ct., Kings County. 1962) (counsel could not exercise retaining lien). But see Cullen v. Olins Leasing, Inc., 91 A.D. 2d 537, 537 (1st Dept. 1982) (insurance company insolvent, lawyer permitted to withdraw).

Scope of Retention of Legal Files . Upon termination of the attorney-client relationship, where no claim for unpaid legal fees is outstanding, the client is presumptively accorded full access to the entire client file, with narrow exceptions. See Sage Realty Corp. v. Proskauer Rose Goetz & Mendelsohn, L.L.P., 91 N.Y.2d 30, 34 (1997). In Sage Realty, the Court of Appeals held that (1) counsel’s former client is entitled to inspect and copy any documents which relate to the representation and are in counsel’s possession, absent “substantial grounds” for counsel to refuse access (abrogating Zackiva Commcn's Corp. v. Milberg Weiss Bershard Specthrie & Lerach, 223 A.D.2d 417, (1st Dep't 1996)); (2) a law firm is not required to disclose documents that might violate a duty of nondisclosure owed to a third party, or otherwise imposed by law, or firm documents intended for internal law office review and use; and (3) generally, unless the law firm has already been paid for assemblage and delivery of documents to the client, performing that function is properly chargeable to the client.

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OF COUNSEL RELATIONSHIPS

Q. Under what circumstances may a lawyer or law firm enter into an “of counsel” relationship with another lawyer or law firm?

A. Under the Rules, lawyers or law firms may hold themselves out as “of counsel” to another lawyer or law firm if they have “a continuing relationship with [that] lawyer or law firm, other than as a partner or associate.” Rule 7.5(a)(4). A “continuing relationship” is regularly defined as a “close, regular, personal relationship.” See N.Y. City 1996-8; ABA Formal Op. 90-357 (holding that use of “the title ‘of counsel,’ or variants of that title, in identifying the relationship of a lawyer or firm with another lawyer or firm is permissible as long as the relationship between the two is a close, regular, personal relationship and the use of the title is not otherwise false or misleading”); s ee also N.Y. State 793 (2006) (of counsel lawyer must be “available to the firm for consultation and advice on a regular and continuing basis). An “of counsel” relationship must be more than “a relationship involving only occasional collaborative efforts among otherwise unrelated lawyers or firms.” ABA Formal Op. 90-357.

The “of counsel” title should not be used to describe a relationship that arises “by the mere referral of business between firms or an occasional consulting relationship.” N.Y. City 1995-8; see also ABA Formal Op. 90-357; N.Y. County 592 (1971). Factors pertinent to a determination of whether a relationship is “continuing, regular and personal” include the sharing of office space and the lawyer's availability for regular consultation. See NY City 1996-8; see also ABA Formal Op. 90-357; N.Y. County 630 (1974). These factors “are strongly indicative of the requisite closeness of relationship, but not conclusive absent closeness, regularity and a personal dimension in the relationship.” N.Y. City 1996-8 (citation omitted).

By contrast, the method of compensation “is not relevant” to whether an affiliation may be designated as "of counsel," and “[t]he fact that the per diem attorney does not work exclusively for the firm” also does not bar an “of counsel” relationship. N.Y. City 1996-8.

Q. May a law firm be "of counsel" to another law firm or lawyer?

A. Yes. See N.Y. City 1995-8; ABA Formal Op. 90-357; see also N.Y. State 793 (2006) (shown in hypothetical); Rule 7.5(a)(4) (“a lawyer or law firm may be designated ‘Of Counsel’...”).

Q. May a lawyer be "of counsel" to more than one law firm at the same time?

A. Yes. See ABA Formal Op. 90-357; see also N.Y. City 1996-8; N.Y. State 793 (2006). However, “[t]here is, to be sure, some point at which the number of relationships would be too great for any of them to have the necessary qualities of closeness and regularity, and that number may not be much beyond two....” ABA Formal Op. 90-357; accord N.Y. State 793 n.1 (2006); N.Y. City 1996-8.

Q. May a partner of one law firm simultaneously be "of counsel" to another law firm?

A. Yes, although it is “not usual, for a lawyer to satisfy the requirements to serve as both a partner in one firm and ‘of counsel’ to another.” See N.Y. City 1995-9. The Committee has opined that these requirements are likely to be satisfied when, for tax reasons, the Washington, D.C.-based partner of a New York firm changes his status to become "of counsel" to the New York firm while simultaneously becoming a partner in a newly formed partnership based in Washington, D.C. comprised of the D.C. partner and all partners of the New York firm. See N.Y. City 1995-9.

Q. How are conflicts imputed among "of counsel" lawyers and law firms?

A. In any "of counsel" relationship, conflicts are ordinarily imputed to and through the "of counsel" lawyer or law firm to the other lawyer or law firm. See N.Y. State 793 (2006); N.Y. City 1996-8 (same); see also N.Y. State 773 (2004) (if lawyer serving on municipal board cannot appear before the board, a law firm to which the lawyer is "of counsel" is also barred); cf. Adv. Comm. Jud. Ethics 06-22 (if judge’s personal attorney is "of counsel" to a law firm, the judge must also exercise recusal when members of the law firm appear before the judge “[i]f it is a continuing counsel relationship, evidenced, for example, by a shared letterhead and other indicia, rather than merely a retainer interest in occasional, discrete, separate cases.”)

Where a lawyer has an "of counsel" relationship with three law firms, conflicts of one firm are imputed to the other two. See ABA Formal Op. 90-357 (“In consequence, the effect of two or more firms sharing an of counsel lawyer is to make them all effectively a single firm, for purposes of attribution of disqualifications.”); see also Nemet v. Nemet, 112 A.D.2d 359, 360 (2d Dep’t 1985) (upholding disqualification based on the appearance of impropriety “evident in the ‘of counsel’ arrangement between these attorneys”). See also N.Y. City 2000-4 (extending the “of counsel” analysis to “affiliated” firms).

Q. May a law firm refer to its "of counsel" lawyers on professional notices, letterheads and signs?

A. Yes, subject to the usual restrictions on lawyer speech. See Rule 7.5(a)(4); N.Y. County 727 (1999) (law firm may indicate on its letterhead that a lawyer "of counsel" to the firm is a retired judge, as long as the representation is truthful, not misleading, and does not suggest that the firm has improper influence over a tribunal, legislative body, or public official); see generally Rules 7.1-7.5.

A business card need not indicate an attorney’s "of counsel" status. See N.Y. County 682 (1990).

An "of counsel" attorney’s name need not be listed on firm letterhead, and as long as the attorney’s name does not so appear, there is no ethical requirement that the attorney’s "of counsel" status be mentioned in connection with the attorney’s signature. See N.Y. County 662 (1984). However, if the "of counsel" attorney’s name does appear on firm letterhead, the nature of the relationship should be disclosed. Id.

Q. How are "of counsel" lawyers treated for purposes of sharing fees?

A. Under Rule 1.5(g), fee splitting between lawyers who are neither partners nor associates is subject to certain limitations. The rule does not address fee splitting in the context of an "of counsel" relationship. Nonetheless, the Committee has concluded that where an "of counsel" lawyer is to receive a percentage of the fees paid by a client directly to the affiliated lawyer or law firm, the "of counsel" lawyer should be deemed an associate for purposes of the rule and the limitations do not apply. See N.Y. City 1996-8 n.2; Gold v Katz, 193 A.D. 2d 566, 566 (1st Dep’t 1993) (upholding fee splitting arrangement where “plaintiff, although listed as ‘Of Counsel’ to the firm, nevertheless had a ‘fixed link’ to it as one who ‘regularly participate[d]’ in its work, and thus should be deemed an ‘associate’ of the firm not subject to the prohibition against fee splitting”).

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ATTORNEY ADVERTISING

Please note that the following questions and answers are designed to assist the Bar in identifying the issues and relevant disciplinary rules pertaining to attorney advertising and solicitations. Counsel are advised in all cases to consult the Rules of Professional Conduct to determine whether the applicable Rules are satisfied. Please also note that certain Rules governing attorney advertising are the subject of pending litigation. See Alexander v. Cahill, 2007 U.S. Dist. LEXIS 53602 (N.D.N.Y. 2007) (appeal pending) The Committee does not opine on the likely outcome of litigation involving challenges to the Rules, which may affect your obligations.

Q. What rules govern attorney advertisements and solicitations under New York ’s Rules of Professional Conduct?

A. Rule 7.1 governs attorney advertisements. Attorney advertising may not contain a statement or claim that is false, deceptive or misleading, or that otherwise violates any Rule. Rule 7.1(a).

Solicitations must also comply with the additional requirements of Rule 7.3.

Additional rules concerning identifying a practice or specialty, and concerning professional letterheads, signs and other notices, are set forth in Rules 7.4 and 7.5, respectively.

Q. What is an advertisement?

A. Under the Rules of Professional Conduct, an advertisement is a public or private communication made by, or on behalf of, a lawyer or law firm, about that lawyer or law firm’s services, the primary purpose for which is the retention of the lawyer or law firm. Rule 1.0(a).

Q. What is a solicitation?

A. A solicitation is a kind of advertisement, one directed to or targeted at a specific recipient or group of recipients, and a significant motive for which is pecuniary gain.

A solicitation is an advertisement initiated by, or on behalf of, a lawyer or law firm that is directed to, or targeted at, a specific recipient or group of recipients, or their family members or legal representatives, the primary purpose for which is the retention of the lawyer or law firm, and a significant motive for which is pecuniary gain. Rule 7.3(b).

Q. Can I send articles, updates or speeches I have written to existing clients or other lawyers?

A. Communications to existing clients or other lawyers are not advertisements. Rule 1.0(a). A lawyer may write for publication on legal topics (or speak publicly) without affecting the right to accept employment so long as the lawyer does not undertake to give individual advice. Rule 7.1(r).

Q. Can I send articles, updates or speeches I have written to prospective clients?

A. If the primary purpose of the communication is the retention of the lawyer or law firm, the communication is advertising and must meet the requirements of Rule 7.1. If the communication is directed to, or targeted at, a specific recipient or group of recipients, or their family members or legal representatives, and a significant motive is pecuniary gain, the communication must also meet the requirements of Rule 7.3 for solicitations.

Q. What information must my advertisement contain under the Rules?

A. All attorney advertisements must include the name, principal law office address and telephone number of the lawyer or law firm whose services are being offered. Rule 7.1(h). For additional requirements concerning solicitations, see Rule 7.3.

Any email containing attorney advertising must contain in the subject line the notation “ATTORNEY ADVERTISING.” Rule 7.1(f).

Every advertisement other than those appearing in a radio, television or billboard advertisement, in a directory, newspaper, magazine or other periodical (and any website related thereto) or made in person under Rule 7.3(a)(1) must be labeled “Attorney Advertising” on the first page, or on the home page in case of a website. Rule 7.1(f). A self-mailing brochure or postcard also must contain the words “Attorney Advertising.” Rule 7.1(f).

Q. What information is prohibited in attorney advertising under the Rules?

A. The following information is prohibited in attorney advertising:

Ad advertisement shall not:

  • include an endorsement of, or testimonial about, a lawyer or law firm from a client with respect to a matter still pending;
  • include a paid endorsement of, or testimonial about, a lawyer or law firm without disclosing that the person is being compensated therefor;
  • include the portrayal of a judge, a portrayal of a fictitious law firm, the use of a fictitious name to refer to lawyers not associated together in a law firm, or otherwise imply that lawyers are associated in a law firm if that is not the case;
  • use actors to portray the lawyer, or members of the law firm, or clients, or utilizing depictions of fictitious events or scenes, without disclosure of same; rely on techniques to obtain attention that demonstrate a clear and intentional lack of relevance to the selection of counsel, including the portrayal of lawyers exhibiting characteristics clearly unrelated to legal competence;
  • be made to resemble legal documents;
  • utilize a nickname, moniker, motto or trade name that implies an ability to obtain results in a matter;
  • utilize a pop-up or pop-under advertisements in connection with computer-accessed communications, other than on the lawyer or law firm’s own website or other internet presence; or
  • utilize meta tags or other hidden computer codes that, if displayed, would violate the Rules.

Rule 7.1(c), (g).

Q. What information may my advertisement contain under the Rules?

A. Subject to the requirement of Rule 7.1(a) that an advertisement not contain any statements or claims that are false, misleading or deceptive, or otherwise violate a Rule, advertisements may include information as to:

  • legal and nonlegal education, degrees and other scholastic distinctions;
  • dates of admission to any bar;
  • areas of the law in which the lawyer or law firm practices, as authorized by the Rules;
  • public offices and teaching positions held;
  • publications of law related matters authored by the lawyer;
  • membership in bar associations or other professional societies or organizations, including offices and committee assignments;
  • foreign language fluency;
  • bona fide professional ratings;
  • names of clients regularly represented, provided that the client has given prior written consent;
  • bank references and credit arrangements accepted;
  • prepaid or group legal service programs in which the lawyer or law firm participates;
  • non-legal services provided by the lawyer or law firm or by an entity owned and controlled by the lawyer or law firm;
  • the existence of contractual relationships between the lawyer or law firm and a non-legal professional or service firm, to the extent permitted by Rule 5.8, and the nature and extent of the services available through those contractual relationships;
  • legal fees for initial consultation;
  • contingency fee rates in civil matters when accompanied by a statement disclosing the information required under Rule 7.1(p) and Judiciary Law § 488(3);
  • range of fees for legal and non-legal services, provided that there be available to the public free of charge a written statement clearing describing the scope of each advertised service;
  • hourly rates; and fixed fees for specified legal and non-legal services.

See Rule 7.1(b)(1)-(4).

In addition, an advertisement may provide the additional information described below only if the statement can be factually supported by the lawyer or law firm as of the date on which the advertisement is published or disseminated; the dissemination of the information does not contain statements or claims that are false, deceptive or misleading or otherwise violate a Rule; and it is accompanied by the following disclaimer: “Prior results do not guarantee a similar outcome”:

  • statements that are reasonably likely to create an expectation about the results the lawyer can achieve;
  • statements that compare the lawyer’s services with the services of other lawyers;
  • testimonials and endorsements of clients or former clients (except that client testimonials or endorsements with respect to a matter still pending remain prohibited); or
  • statements describing or characterizing the quality of the lawyer’s or law firm’s services.

Rule 7.1(d)-(e).

Q. Can I include a nickname, moniker, motto or trade name in my advertising?

A. Attorney advertising can include a nickname, moniker or motto or trade name only if that nickname, moniker, motto or trade name does not imply an ability to obtain results in a matter. Rule 7.1(c)(7). A lawyer or law firm may use a telephone number which contains a domain name, nickname, moniker or motto that does not otherwise violate the Rules. Rule 7.5(f).

Q. Can I use a domain name for my internet website that does not include my name or the name of my law firm?

A. A lawyer or law firm may use a domain name for an internet web site that does not include the name of the lawyer or law firm, provide that all pages of the web site clearly and conspicuously include the actual name of the lawyer or law firm; the lawyer or law firm in no way attempts to engage in the practice of law by using the domain name; the domain name does not imply an ability to obtain results in a matter; and the domain name does not otherwise violate the Rules. Rule 7.5(e).

Q. Can I include the words “and Partners” or “and Associates” in my firm name if other lawyers are not partners in, or associated with, my firm?

A. Lawyers cannot hold themselves out as having a partnership with one or more lawyers unless they are in fact partners. Rule 7.5(c). Similarly, a lawyer cannot imply that lawyers are associated in a law firm if that is not the case. Rule 7.1(c)(3).

Q. Can my law firm practice under a trade name?

A. A lawyer in private practice cannot practice under a trade name or a name that is misleading as to the identity of the lawyer or lawyers practicing under such a name, or containing names other than those of one or more of the lawyers in the firm. Rule 7.5(b).

Q. Can my law firm name include the name of a non-lawyer?

A. Rule 7.5(b).

Q. Can my law firm name include the name of a deceased or retired member of the firm or a predecessor firm?

A. If otherwise lawful, a law firm may use as, or continue to include in its name the name or names of one or more deceased or retired members of the firm or of a predecessor firm in a continuing line of succession. Rule 7.5(b).

Q. Can my law firm name include the name of a lawyer who holds judicial, legislative or public executive or administrative post or office?

A. A lawyer who assumes a judicial, legislative or public executive or administrative post or office may not permit the lawyer’s name to remain in the name of the law firm or to be used in professional notices of the firm during any significant period in which the lawyer is not actively and regularly practicing law as a member of the firm, and during such period, other members of the firm cannot use the lawyer’s name in the firm name, or in professional notices of the firm. Rule 7.5(b).

Q. Can my advertisement include a statement of my area of practice or my specialty?

A. A lawyer or law firm may publicly identify one or more areas of law in which the lawyer or law firm practices, or may state that the practice of the lawyer or law firm is limited to one or more areas of law.

  • A lawyer or law firm may not state that the lawyer or law firm is a specialist or specializes in a particular area of law, except as follows:
  • A lawyer admitted to engage in patent practice before the United States Patent and Trademark Office may use the designation “Patent Attorney” or a substantially similar designation.
  • A lawyer who is certified as a specialist in a particular area of law or practice by a private organization approved for that purpose by the American Bar Association may state the fact of certification if, in conjunction therewith, the certifying organization is identified and the following statement is prominently made: “The [name of the private certifying organization] is not affiliated with any governmental authority. Certification is not a requirement for the practice of law in the State of New York and does not necessarily indicate greater competence than other attorneys experienced in this field of law.”

A lawyer who is certified as a specialist in a particular area of law or practice by the authority having jurisdiction over specialization under the laws of another state or territory may state the fact of certification if, in conjunction therewith, the certifying state or territory is identified and the following statement is prominently made: “Certification granted by the [identify state or territory] is not recognized by any governmental authority within the State of New York. Certification is not a requirement for the practice of law in the State of New York and does not necessarily indicate greater competence than other attorneys experienced in this field of law.”

Rule 7.4.

Q. Can I include a paid endorsement or testimonial in my advertising?

A. An advertisement that otherwise complies with the Rules may include a paid endorsement of or testimonial about a lawyer or law firm only if the advertisement discloses that the person is being compensated therefor (Rule 7.1(c)(2)); the endorsement or testimonial does not come from a client with respect to a matter that is still pending (Rule 7.1(c)(1)); the advertisement does not contain statements or claims that are false, deceptive or misleading, or otherwise violate a Rule; it can be factually supported by the lawyer or law firm as of the date on which the advertisement is published or disseminated; and it is accompanied by the disclaimer, “Prior results do not guarantee a similar outcome.” Rule 7.1(d)(3), (e).

Q. Can I use actors or fictionalized events or scenes in my advertising?

A. An advertisement that otherwise complies with the Rules may use actors or fictionalized events or scenes provided that the advertisement discloses their use. Rule 7.1(c)(4).

Q. Can my advertisement include statements comparing my services with the services of other lawyers?

A. An advertisement may use statements that compare the lawyer’s services with the services of other lawyers only if the statements can be factually supported by the lawyer or law firm as of the date on which the advertisement is published or disseminated, the advertisement is not false, deceptive or misleading, and does not otherwise violate the Rules, and the comparative statement is accompanied by the disclaimer “Prior results do not guarantee a similar outcome.” Rule 7.1(e).

Q. Can my advertisement include statements about the results I can obtain?

A. An advertisement may include statements that are reasonably likely to create an expectation about the results a lawyer can achieve only if the statements can be factually supported by the lawyer or law firm as of the date on which the advertisement is published or disseminated, the advertisement is not false, deceptive or misleading, and does not otherwise violate the Rules, and the comparative statement is accompanied by the disclaimer “Prior results do not guarantee a similar outcome.” Rule 7.1(e).

Q. Must I keep copies of my advertisements or websites? For how long?

A. A lawyer or law firm must retain copies of all advertisements for a period of not less than three years following initial dissemination, except that copies of advertisements contained in a computer-accessed communication shall be retained for not less than one year. Rule 7.1(k).

Websites containing advertising shall be preserved upon initial publication of the website, any major website redesign, or a meaningful and extensive content change, but in no event less frequently than once every 90 days. Rule 7.1(k).

A lawyer or law firm making a solicitation must satisfy additional requirements, including filing a copy of the solicitation with the appropriate attorney disciplinary committee and, if the solicitation is directed to predetermined recipients, retaining a list containing the names and addresses of all recipients for a period of not less than three years following the last date of dissemination. See Rule 7.3(c)(1),(3).

Q. Must I file copies of my advertisements with the disciplinary committee?

A. Only advertisements that are also solicitations must be filed with a disciplinary committee. Rule 7.3(b),(c).

Q. What must I file with the disciplinary committee for a solicitation?

A. All solicitations directed to a recipient in the State of New York must be filed with the appropriate disciplinary committee. The filing shall consist of a copy of the solicitation, a transcript of the audio portion of any radio or television solicitation and, if the solicitation is in a language other than English, an accurate English-language translation.

The filing requirement does not apply to solicitations directed or disseminated to a close friend, relative, or former or existing client; a web site maintained by the lawyer or law firm, unless the web site is designed for and directed to, or targeted at, a prospective client affected by an identifiable actual event or occurrence or by an identifiable prospective defendant; or professional cards or other announcements authorized by Rule 7.5(a).

Rule 7.3(c)(1),(5).

Q. Where do I file copies of my solicitations?

A. Copies of solicitations are to be filed with the attorney disciplinary committee of the judicial district or judicial department wherein the lawyer or law firm maintains its principal office. Where no such office is maintained, the filing shall be made in the judicial department where the solicitation is targeted. Rule 7.3(c).

Q. What kinds of solicitation are prohibited?

A. Solicitations by in-person or telephone contact, or real-time or interactive computer-accessed communication are prohibited unless the recipient is a close friend, relative, former client or existing client.

Solicitations by any form of communication are prohibited if:

  • the communication or contact violates Rules 4.5(a)-(b) or 7.3(e) [governing communications after incidents involving potential claims for personal injury or wrongful death] or Rule 7.1(a) [prohibiting statements that are false, deceptive or misleading, or otherwise violate a Rule];
  • the recipient has made known to the lawyer a desire not to be solicited by the lawyer;
  • the solicitation involves coercion, duress or harassment;
  • the lawyer knows or reasonably should know that the age or the physical, emotional or mental state of the recipient makes it unlikely that the recipient will be able to exercise reasonable judgment in retaining the lawyer; or
  • the lawyer intends or expects, but does not disclose, that the legal services necessary to handle the matter competently will be performed primarily by another lawyer who is not affiliated with the soliciting lawyer as a partner, associate or of counsel.

Rule 7.3(a).

Q. Are there special rules relating to specific incidents involving potential claims for personal injuries or wrongful death?

A. No solicitation relating to a specific incident involving potential claims for personal injury or wrongful death is permitted before the 30th day after the date of the incident, unless a filing must be made within 30 days of the incident as a legal prerequisite to the particular claim, in which case no unsolicited communication is permitted before the 15th day after the date of the incident. Rule 7.3(e).

In addition, no unsolicited communication is permitted to any individual injured in the accident or to a family member or legal representative of such an individual, by a lawyer or law firm, or by any associate, agent, employee or other representative of a lawyer or law firm representing actual or potential defendants or entities that may defend and/or indemnify said defendants, before the 30th day after the date of the incident, unless a filing must be made within 30 days of the incident as a legal prerequisite to the particular claim, in which case no unsolicited communication is permitted before the 15th day after the date of the incident. Rule 4.5(a).

Q. Can I provide a retainer agreement along with my solicitation?

A. A retainer agreement may be provided along with a solicitation only if the top of each page is marked “SAMPLE” in red ink in a type size equal to the largest type size used in the agreement and the words “DO NOT SIGN” appear on the client signature line. Rule 7.3(g).

Q. Can my advertisement include information about rates, fixed fees or fee schedules?

A. A lawyer or law firm advertising any fixed fee for specified legal services must, at the time of fee publication, have available to the public a written statement clearly describing the scope of each advertised service, which statement must be available to the client at the time of retainer for any such service. Such legal services must include all those services that are recognized as reasonable and necessary under local custom in the area of practice in the community where services are performed. Rule 7.1(j).

Q. Am I bound by my published fee information? For how long?

A. If a lawyer or law firm advertises a range of fees or an hourly rate for services, the lawyer or law firm cannot charge more than the fee advertised for such services.

If a lawyer or law firm advertises a fixed fee for specified legal services, or performs services described in a fee schedule, the lawyer may not charge more than the fixed fee for such stated legal services as set forth in the advertisement or fee schedule, unless the client agrees in writing that the services performed or to be performed were not legal services referred to or implied in the advertisement or in the fee schedule and, further, that a different fee arrangement shall apply to the transaction.

Unless otherwise specified, if a lawyer broadcasts any fee information authorized under Rule 7.1, the lawyer is bound by any representation made therein for a period of not less than 30 days after such broadcast.

Unless otherwise specified in the advertisement, if a lawyer publishes any fee information authorized under Rule 7.1 in a publication that is published more frequently than once per month, the lawyer is bound by any representation made therein for a period of not less than 30 days after such publication. If a lawyer publishes any fee information authorized under Rule 7.1 in a publication that is published once per month or less frequently, the lawyer is bound by any representation made therein until the publication of the succeeding issue. If the lawyer publishes any fee information authorized under Rule 7.1 in a publication that has no fixed date for publication of a succeeding issue, the lawyer is bound by any representation made therein for a reasonable period of time after publication, but in no event less than 90 days.

Rule 7.1(l)-(n).

 

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1 The "disinterested lawyer" test under DR 5-105(C) of the former Code of Professional Responsibility has been superseded by the "reasonable belief" standard of Rule 1.7. Nevertheless, the conflicts analysis under both the Code and the Rules is substantively the same.

 


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