Remedying Ethical Conflicts in a Global Legal Market

Georgetown Journal of Legal Ethics, The, Summer 2006 by Whitaker, Jamie Y

INTRODUCTION

Peter Partner arrives at work on Monday morning at 7:45. After placing his morning mocha on the coaster near his phone, he sits down at his desk and turns on his computer to check his e-mail. While waiting for his computer to boot up, he receives a phone call from a local client who wants to know the legal implications in the United States of selling off some of his corporation's Indian subsidiaries (local client/foreign transaction). Promising to get back to the client, Peter hangs up the phone and reads an e-mail from a client in the United Kingdom. The client is considering merging his corporation with a U.S. corporation and wants Peter's advice on American corporate laws in light of a recent, highly publicized attempted takeover of a major U.S. oil firm by a Chinese oil company (foreign client/local transaction). Before he can respond to this e-mail, Peter's administrative assistant reminds him that he has a flight on Thursday to Tokyo where he will be meeting with another client to finalize a sale-of-goods contract with an American company (foreign client/foreign transaction).

Peter's situation is like that of many modern lawyers-a thriving practice with clients both locally and abroad. This diversity of clientele means the advice that Peter gives his clients will have far-reaching effects, often in jurisdictions beyond the borders of the United States, in addition to the jurisdiction in which Peter is licensed. American attorneys know that their behavior as professionals is directed by the rules of professional conduct promulgated in their licensing jurisdiction, some of which have adopted the American Bar Association's Model Rules of Professional Conduct ("Model Rules").1 Such rules of conduct are determined in part by local and national values and ideas of professionalism. But what is an attorney to do when advising clients that do not share the same values, or practicing law in jurisdictions with differing ideas of professionalism? In the modern global legal market, to what standard of professional conduct is the modern lawyer ethically bound? The legal field is no longer limited geographically, as attorneys in increasing numbers are practicing in, have clients from, and are engaging in transactions that affect multiple jurisdictions. Such an international environment is ripe for ethical conflicts that are not easily remedied.

One area where potential ethical conflicts can clearly arise is attorney-client confidentiality. Although it may vary in form and scope, attorney-client confidentiality is one of the primary pillars of legal practice the world over, safeguarding the relationship between attorney and client. In the American adversarial common law system, attorney-client confidentiality is pivotal to the proper representation of clients by lawyers and is one of the lawyer's principal professional duties.2 Arguably, the principles of confidentiality and privilege3 "[encourage] clients to provide complete, accurate information to their counselors so that the lawyers [can] represent their clients competently."4 This idea of the free and protected exchange of information between attorney and client strongly reflects the societal role of fidelity in the practice of law in the United States.5

Model Rule 1.6 highlights the guiding principles regarding confidentiality in the relationship between American lawyers and their clients, stating that, in general, a lawyer "shall not reveal information relating to the representation of a client. . . ."6 The rule, however, is not absolute; that is, there are particular situations in which an attorney may reveal confidential client information.7 Most importantly, Model Rule 1.6 was revised after the corporate scandals of the early twenty-first century to provide more leeway for attorneys in situations where they may need to break their client's confidences in order to prevent crime or fraud with financial impact.8

Many other countries have rules regarding attorney-client confidentiality that are similar in language to the Model Rules, but this does not necessarily mean that their application in any given situation is the same. When a conflict between two such regulations occurs how is an attorney to act? After all, professional ethics govern how an attorney is to behave in his professional capacity. Is there any ethical guidance for the modern lawyer in the new global legal context? How is he to know which rules of professional conduct guide his actions when foreign clients, foreign transactions, or foreign jurisdictions are involved?

As this Note will demonstrate, with the ever increasing globalization of the legal practice, there is a need for clear rules governing an attorney's ethical behavior in regard to his obligations to foreign clients, practice of law in a foreign jurisdiction, and transactional work with potentially cross-jurisdictional effect. This Note addresses these issues by looking at the globalization of the legal practice and the potential for ethical conflicts in such an environment, particularly in the area of confidentiality. While there are other ethical obligations that attorneys have to their clients and in their professional capacity that are equally relevant to this topic, I have chosen attorney-client confidentiality as a case study for the larger issue of ethical conflicts in a global legal market. Similarly, while there are many jurisdictional standards that govern attorney professional behavior in the United States, for the purpose of this Note, it is assumed that attorney conduct is guided by the Model Rules.