October 03, 2018

MONTH-IN-BRIEF: Legal Opinions & Ethics

Keith R. Fisher, Christina Houston

Professional Responsibility

CA Supreme Court Rules on Advance Waivers in Shepard Mullin Case

By Keith R. Fisher

Last month, the California Supreme Court held that Sheppard, Mullin, Richter & Hampton, LLP’s failure specifically to inform a client of its representation of an adverse party in unrelated matters was an ethical violation which invalidated the engagement agreement.  The firm represented a manufacturing company in a federal qui tam action brought on behalf of a number of public entities at the same time that it represented one of these public entities in unrelated matters.  Both clients had executed engagement agreements that purported to waive all such conflicts of interest, current or future, but the agreements did not specifically refer to any specific conflict and the law firm did not tell either client about its representation of the other.  

The waiver was ineffective, the court held, because the firm failed to disclose a known conflict with a current client.  Unless that conflict is specifically disclosed, a general advanced conflict waiver is not valid in California.

Nevertheless, the state high court held that the firm might still be able to recover the value of its legal services under quantum meruit.  This reverses the denial by the intermediate appellate court of the firm’s bid to recover some portion of the roughly $1 million in unpaid fees.  That claim will be decided by the trial court on remand. 

Keith Fisher

Principal Consultant 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.