Conference of California Public Utility Counsel 2009 Annual Meeting

1. Conference of California Public Utility Counsel 2009 Annual Meeting Hot Topics in Ethics -- Recent Conflict of Interest Developments Affecting Practice Before the Commission New Rule 1-650 of the California Rules of Professional Conduct Dan L. Carroll* Downey Brand LLP *The views expressed in this presentation are the presenter’s own individual views, and should not be construed as representing the position of Downey Brand LLP or the State Bar Standing Committee on Professional Responsibility and Conduct.

2. Text of New Rule 1-650 [operative August 28, 2009] (A) A member who, under the auspices of a program sponsored by a court, government agency, bar association, law school, or nonprofit organization, provides short-term limited legal services to a client without expectation by either the member or the client that the member will provide continuing representation in the matter: (1) is subject to rule 3-310 only if the memberknows that the representation of the client involves a conflict of interest; and

3. Text of New Rule 1-650 (cont’d) (2) has an imputed conflict of interest only if the member knows that another lawyer associated with the member in a law firm would have a conflict of interest under rule 3-310 with respect to the matter. (B) Except as provided in paragraph (A)(2), a conflict of interest that arises from a member's participation in a program under paragraph (A) will not be imputed to the member's law firm. (C) The personal disqualification of a lawyer participating in the program will not be imputed to other lawyers participating in the program.

4. Why Such A Rule? “Backers of the change hope the new rule will increase the availability of short-term limited legal services, particularly during the current economic downturn. Legal services programs report an increased need for lawyer volunteers to help people out of work, bankruptcy debtors, crime victims, particularly victims of increased domestic violence, and the thousands of California residents facing foreclosure or who need help with mortgage loan modification.” California State Bar Journal, September 2009

5. Qualifying Programs • Program must be sponsored by a court, government agency, bar association, law school, or nonprofit organization • Examples: • legal-advice hotlines • advice-only clinics • pro se counseling programs • Programs sponsored by others, such as for profit companies or individual private law firms, would not fit the definition

6. Who Is Covered? • Member - a member of the State Bar of California. Rule 1-100(B)(2) • Lawyer - member of the State Bar of California or essentially an admitted lawyer in good standing in any other state or federal court as well as courts of other countries. Rule 1-100(B)(3)

7. Who Is Covered? (cont’d) • Law Firm • two or more lawyers practicing law who share profits, expenses, and liabilities; or • law corporation which employs more than one lawyer; or • division, department, office, or group within a business entity, which includes more than one lawyer who performs legal services for the business entity; or • publicly funded entity which employs more than one lawyer to perform legal services. Rule 1-100(B)(1)(a) - (d)

8. Requirements • Must be qualified program • Services short-term and limited; no expectation of lawyer or client must that lawyer will continue to represent client • Attorney must obtain informed consent from client to limited scope of representation; verbal consent apparently acceptable, but not advisable • Attorney must not know that the representation of the short-term client involves a conflict of interest

9. Protections If Follow Requirements of Rule • Attorney’s law firm will face imputed conflict of interest during the short-term representation only if the attorney knows that another attorney associated with the attorney in a “law firm” would have a conflict under rule 3-310. • If attorney provides qualified legal advice and returns to the office to learn another firm attorney represents opposing party of short term client, firm not disqualified from representing the firm client against the attorney’s short-term client.

10. Protections If Follow Requirements of Rule (cont’d) • If attorney is personally disqualified due to participation in the qualified program, disqualification will not be imputed to other attorneys who participate in the program. • Although volunteer attorney may be personally disqualified from representing a firm client against the short-term client, other attorneys in the qualified program not disqualified from representing short-term client against the client of the volunteer attorney’s firm.

11. Other Details • Other than as provided in the rule, Rules of Professional Conduct and the State Bar Act, including member's duty of confidentiality, apply to the limited representation of the short-term client [Rule 1-650, comment 2] • If the short-term limited representation becomes an ongoing representation, rule 3-310 and all other Rules of Professional Conduct “become applicable” [Rule 1-650, comment 5] • At that point, the “safe harbor” provided by the rule no longer applies

12. Precautionary Measures Still Advisable • Attorneys should take list of key firm clients when they volunteer • If specific subject matter of clinic known in advance, list can be tailored to clients the firm represents with respect to that subject matter • Program should develop form to use in obtaining short-term client’s informed consent

13. Precautionary Measures (cont’d) • Program and volunteer attorneys should develop method for attorney to learn name of opposing party before consulting with short-term client, so attorney can decline consultation if attorney knows there is a conflict • Attorney should keep list of clients assisted, opposing parties, and brief summary of subject matter discussed, and enter information in firm’s conflict system upon returning to law firm