Attorney Ethics Counsel

February 09, 2016

Negotiating for Your Clients: How Far is Too Far?

California attorneys have a well-established duty to be zealous advocates for their clients’ interests.  But the boundaries for that zealous advocacy are not always clear. The California Rules of Professional Conduct do not contain a rule analogous to ABA Model Rule 4.1 and related comments, addressing the boundaries of acceptable puffery, which is ok, and false representations of material fact, which (surprise!) are not.  Formal Opinion No. 2015-014 from California’s Standing Committee on Professional Responsibility and Conduct appears intended to fill this gap, and more clearly to define the boundary between zealous advocacy and, well, lying.  In general, the analysis mirrors 4.1, so puffery and posturing is permissible, but false statements of fact, or implicit misrepresentations of material facts, are not.  The opinion details five examples to illustrate this distinction.

Example 1.  Attorney represents that a favorable eyewitness would give positive testimony, even though attorney has not yet found the witness.  Not ok: this is not the attorney’s opinion, or argument, about the strength of a witness, but a fabrication about whether the witness even exists, and about what type of testimony the witness would provide.

Example 2.  Attorney inflates plaintiff’s annual salary to inflate her damages claim for lost wages.  Not ok: again, this is not an attorney advocating for viewing the facts a certain way.  It’s the attorney changing the facts.

Example 3.  Attorney inflates his client’s “bottom line” number in settlement negotiations.   Probably ok: it is safe to assume attorneys posture like this in negotiations, as a tactic.  Attorneys and clients know this, or should.  Make sure your client is on board with that strategy, though.

Example 4.  Attorney represents that insurance coverage limit is $50,000 when it is actually $500,000.  Not ok: this is a “misrepresentation of fact intended to mislead plaintiff and her lawyer.”  An attorney’s representation about the likely outcome of a coverage issue might be closer to the line, but asserting a false fact is not.  It is also not zealous advocacy to misrepresent anything that your opponent can, and definitely will, seek to confirm through discovery.  That does not mean it’s ok to lie as long as you don’t get caught.  But it’s especially unwise to misrepresent things that can be, and will be, verified.

Example 5.  Attorney represents that client will file for bankruptcy protection, when attorney knows client has received advice that he cannot.  Probably ok: if the attorney states that client intends to file for bankruptcy, this would be false; however, if the attorney does not know client’s intent, or states that bankruptcy may be an option depending on the circumstances, such statements may be permissible.

Example 6.  Plaintiff instructs attorney to conceal material facts from Defendant in settlement conference.  Attorneys generally don’t have a duty to highlight or to illustrate bad facts for their opponents, and if you do that routinely you are not really living up to the standard of zealous advocacy.  But the analysis is different if circumstances have changed (assume your client’s wage claim is based on her not having a job; but she just got a job) and your opponents are justifiably relying on your prior representations.  It’s the difference between focusing on the good facts and spinning them to your client’s advantage, which attorneys should–and must–do, and lying by omitting the bad facts entirely.  Don’t do it.  If clients insist, withdraw.


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