April 02, 2018

MONTH-IN-BRIEF: Legal Opinions & Ethics

Keith Fisher, Christina Houston

Professional Responsibility

Jewel Developments: Dissolved Law Firms’ Claims for Fees

By Keith R. Fisher

On certification from the Ninth Circuit in the Heller Ehrman bankruptcy, the California Supreme Court unanimously held on March 5 that a dissolved law firm has no property interest under California law in hourly basis legal matters and therefore no property interest in the profits generated by its former partners’ work on hourly fee matters pending at the time of the firm’s dissolution. The ruling is a serious setback for bankruptcy trustees claiming entitlement to earnings of successor law firms hired by a dissolved firm’s former clients to complete the unfinished legal work. A similar result was reached by the N.Y. Court of Appeals in 2014 in the Thelen bankruptcy. On February 27, the Ninth Circuit certified a related question to the D.C. Court of Appeals in the Howrey bankruptcy: whether a dissociated partner owes a duty to the former law firm to account for profits earned post-departure on hourly basis legal matters in progress but not completed at the time of the partner’s departure, where those matters were completed at another firm that hired the partner and, if so, whether D.C. law allows the former firm to recover those profits from the new firm on an unjust enrichment theory.

Federal Judge Offers Primer on E-mails and Privilege

By Keith R. Fisher

In ruling on a routine discovery dispute between Sodexho and Drexel University involving a privilege log, a federal judge used the occasion to pen a baker’s dozen of hypotheticals to illustrate the applicability of attorney-client privilege to e-mails. The judge regarded the following three as privileged (legal advice is sought or provided) and exempt from production:  1. President of Food Service Corporation A sends email to General Counsel, “What are the requirements of a binding contract for food service contract with College X?”  2. Counsel emails the President—with a list of the requirements for such a contract. 3. President to Corporation A's VP, who as part of her job is engaged in negotiations with College X, “Our General Counsel has advised me that in order to form a binding contract with College X, we need to agree on requirements 1, 2, and 3.” 

But the following three are not privileged: 4. VP to Corporation A's Sales Manager: “President has instructed us to proceed to negotiate a contract for food services with College X. Get to this ASAP.”  5. Sales Manager to VP: “I've just met with Manager of College X and we have a handshake deal. How much detail do we need in the written contract?”  6. VP to President: “Sales Manager reached a great deal for us. Let's keep the written contract simple and direct to close the deal  ASAP.” No legal advice is sought or provided in these hypos.

Keith Fisher

Principal Consultent and Senior Counsel, National Center for State Courts

An honors graduate of Princeton University and Georgetown University Law Center, Keith Fisher joined the National Center for State Courts in 2015 as Principal Consultant and Senior Counsel for Domestic and International Court Initiatives.  He is an experienced lawyer and law professor and is a nationally known expert on domestic and international financial services regulation and legal and judicial ethics.  Recent speaking engagements on domestic and international  ethics issues include the Center for Judicial Ethics National Judicial College, the International Conference on Court Excellence in Singapore, the Professional Responsibility Training Session for Immigration Judges, an American-Hellenic Chamber of Commerce Symposium on Improving the Greek Court System, the Magistrature de Quebec’s Colloque soulignant les 40 ans du Conseil de la magistrature, the U.N.’s Global Judicial Integrity Network conference on social media in Vienna, and the Konrad Adenauer Stiftung’s conference on judicial ethics and social media..  He also serves on the Board of Editors for UNESCO publications on judicial bioethics.

Christina Houston

Counsel, DLA Piper

Christina’s practice focuses on legal opinions, LLCs, partnerships, trusts and corporations and general commercial transactions. Christina is a member of the Partnership and Limited Liability Company Committee of the Corporation Law Section of the Delaware State Bar Association, which is responsible for annually reviewing and updating Delaware’s partnership and LLC statutes. Christina also is actively involved in the Legal Opinions Committee of the American Bar Association Business Law Section, the Committee on LLCs, Partnerships and Unincorporated Business Associations and the Business Law Basics Committee of the Business Law Section of the American Bar Association. She is the current Chair of the Opinion Issues in LLCs Subcommittee. Christina is a member of the TriBar Opinion Committee.