Qualcomm: Scandal and Professional Reputation

By Elizabeth S. Conan

If he grows reckless in his zeal to win, he may learn, too late, that no splints yet invented will heal a lawyer’s broken reputation.
—Paul O’Neil

After originally finding in January 2008 that lawyers for the technology company Qualcomm intentionally withheld thousands of electronic documents in a patent dispute brought by rival Broadcom, Judge Barbara Major abruptly reversed course in April 2010 , holding that although there was “an incredible breakdown in communication,” there was insufficient evidence of bad faith on the part of the attorneys to support any sanctions for misconduct.

The strong language of the original sanctions order had been a slap to e-discovery novices heard nationwide. Analysts predicted that the stigma would haunt Qualcomm’s representatives for years, and although the court ultimately absolved those attorneys, Judge Major’s original decisions significantly and quickly damaged many professional reputations: Qualcomm’s general counsel resigned shortly after the discovery problems arose; Howrey LLP absorbed Day Casebeer Madrid & Batchelder, the firm handling the Qualcomm case; and four of the six implicated attorneys left corporate Big Firm practice entirely.

Today, the former associates and partner are teaching, consulting, or starting over in solo practices, and likely wondering whether they will ever be able to overcome the pall of doubt cast over their professional integrity. When the scandal broke, two of the former attorneys were at the threshold of their legal careers, having been admitted less than a decade before. One is optimistic about his redemption. The other seems resigned to the fact that his professional reputation will never recover.

In the Eyes of the Public
Obviously, the public is intrigued with ethics scandals, if for nothing other than their pure entertainment value. When conclusive evidence of misconduct is paraded through the media, judgment in the court of public opinion is swift—and ruthless. But what impact does public perception have on the careers of practitioners who are wrongly accused, and later exonerated?

Only four years after being admitted to the Oregon Bar, attorney Brandon Mayfield found himself imprisoned when a faulty fingerprint match led to his incorrect identification as a suspect in the Madrid train bombings that killed 191 people in 2004. Before the news broke he was, according to reporters, just another attorney whose solo practice was so low key that some who shared his office complex were not even aware of his presence. After he was released, it became widely reported that he was a convert to Islam. Former clients became concerned about continuing to work with him, for fear that the government was listening to privileged communications, and his business dwindled.

Several months ago, one of the former Qualcomm attorneys had reached the second round of callback interviews when his headhunter telephoned and abruptly informed him that he was no longer in the running. The potential employer had read the riot act to the recruiter for even including a “Scarlet Q” in the applicant pool. Another recounted how a Day Casebeer client had to be reassured that the sanctioned attorneys were no longer with the firm months after the misconduct news broke.

Perhaps its misunderstanding of formal regulatory codes causes the public to be so heavily influenced by the media in its perceptions of acceptable lawyer conduct. For the most part, consumers just want lawyers who return their calls and get good results. When they feel wronged by an attorney’s unprofessional conduct, closure of their bar complaints based on insufficient evidence of technically sanctionable misconduct upsets consumers. It just seems fundamentally wrong. Aside from publishing informative websites, state bar associations do little to actively educate the public about lawyer regulation and its inherent limitations.

On the other hand, widespread accessibility to all types of media gives legal consumers many convenient resources to break down legal complexities into understandable infobytes. It becomes quite easy to rely on the abbreviated versions of ethics scandals being broadcast in countless forms, rather than to make an effort to independently verify the alleged facts.

Further misperceptions arise when the public misses the memo on significant post-headline developments. The order declining sanctions against the Qualcomm attorneys, and the coverage of the government’s apology and restitution payment to Brandon Mayfield, received but a fraction of media time as their respective initial headlines.

To the tabloid-fueled world, being ethical is boring. Media coverage plays off the public’s unflattering stereotype of the shady lawyer, directly conflicting with public demand that lawyers adhere to the highest standards of honesty and integrity. But in reality, only a small percentage of attorneys and consumers benefit by unethical conduct and questionably legal tactics.

In the Eyes of Their Peers
Ethics is a reactive arena, with little guidance in terms of what an ethical attorney should do, but plenty of prohibitions. Contrast the 1908 ABA Canons of Professional Ethics, which spoke in aspirational terms encouraging lawyers to obey their own consciences, with the straightforward standards of minimum acceptable conduct we see today that are based largely on the ABA Model Rules of Professional Conduct released in 1983. These changes took “doing the right thing” out of the picture and left even less of a regulated incentive for attorneys to adhere to some higher moral standard.

A former Qualcomm lawyer noted that the values he possessed going into law school were not those valued in the world of big firms, and he emphasized that it had been easy to quickly lose sight of the values that originally motivated him to enter the profession. Considering that society does not compensate attorneys for their contributions toward a greater good, what non-personal incentives to stay true to moral values exist?

This begs another question: whether large law firms hold the power to improve individual accountability for misconduct. Theoretically, large firms have an internal system of checks and balances for effective self-regulation and are conceivably motivated to do so under regulatory rules that hold senior attorneys accountable for the actions of subordinates and staff. Larger firms also possess the financial resources that enable associates to become educated in ethics requirements. However, larger firms may suffer from the convenience of anonymity—they are depersonalized to the point that they can only be held accountable through aggressive inspection by the bar or by the courts. The concentration of power and wealth in larger firms can increase not only the ability to conceal misconduct, but also the temptation to do so. Qualcomm’s debacle was just such a combination of systemic communication errors and organizational flaws that contributed to an appearance of gross misconduct.

The burden to cultivate and maintain ethical behavior in the legal profession would seem to fall to us, the officers of the court. A firm’s leadership plays key roles in the preservation and protection of an established reputation, which is particularly vulnerable in times of ethics crisis when senior partners can chose to restore morale by stepping up to its defense or deny mistakes and focus on their own departures.

As long as there exists the perception that earning capacity tops the list of desirable traits in a lawyer, there will be financial incentives to manipulate the code of ethics. One of the former Qualcomm attorneys reportedly brought some of the undisclosed documents to a senior partner and was dismissed when he asked for guidance as to proper disclosure. Wall Street’s corporate lawyers also recently succumbed to organizational pressures that evidently made the cost of complying with ethical and moral demands too great. In this sense, the rules regulating attorney conduct are the only means of protecting unsuspecting clients.

Attorneys versed in the codes of conduct and immersed in the legal culture are much more cognizant than the public of who’s who among ethical practitioners. Peers have a significant and unique ability to help struggling attorneys overcome the stigma of being wrongfully accused of misconduct, as in the case of Brandon Mayfield, who credits client referrals from fellow lawyers with eventually reestablishing his practice.

Nancy Temple, the former Arthur Andersen in-house counsel who was convicted in 2002 of obstruction of justice in the Enron scandal, was not so fortunate. Although the U.S. Supreme Court ultimately reversed her conviction three years later, the Enron stigma barred her from in-house counsel work with any publicly held companies, and despite maintaining friendly ties with her former colleagues, she struggled in solo practice for years. She eventually advanced to an of-counsel position with a small firm. Just when the worst seemed behind her, Temple found herself abandoned after the partners transferred to a prestigious Chicago firm. They did not seriously consider Temple’s inclusion in the move, nor did they broach the subject with the new firm’s leadership.

Recruiters and senior partners alike told the job-seeking attorneys who left Day Casebeer in the wake of Qualcomm that nothing could be done to help secure work with the sanctions hanging over their heads. That sentiment may change, now that the court has declined to punish these attorneys. One former Qualcomm attorney reported that his peers have been universally sympathetic to his situation. He believes that going into business for himself was the most effective means of minimizing the sanctions debacle, describing the move as risky, but with the added benefit of vaulting him to a level of professional satisfaction that may never have been possible had he simply continued on the corporate litigation ladder.

Temple feels likewise blessed. To help her endure the stress of the Enron litigation nearly a decade ago, she began training for triathlons in the Chicago area. It was during those training sessions that she met her current business partner, with whom she has formed a six-person firm in Chicago that is enjoying a growing reputation. Temple credits the ethics crisis with opening paths she would not have otherwise taken.

Conclusion
Don’t take for granted the gift of an unblemished professional reputation, one former Qualcomm attorney recently cautioned. Self-regulation that relies on peer and public complaints to ferret out, analyze, and sanction ethical misconduct appears to be a poor substitute for the instant accountability borne of public scrutiny, as most disciplinary sanctions for misconduct, monetary or otherwise, are not nearly as effective a punishment as calling into question an attorney’s integrity.

It remains to be seen if the “Scarlet Q” will fade with time, or whether the accusation of misconduct coupled with its publicity will be of lasting detriment, regardless of developments that removed the original accusations. It cannot be denied that in comparison with the sensationalized media coverage of the accusations, the resolution of an ethics scandal is insignificant in terms of restoring a damaged reputation. But as in the case of those who fell before them, the reputations of lawyers wrongfully accused of misconduct can be rebuilt—with time, patience, and the help of their fellow attorneys.

 

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