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american lawyer media news service Hartford, conn.-In a case that cuts to the heart of what it means to be a company’s lawyer, the Greenwich, Conn.-based liquid chemical shipping line, Stolt-Nielsen Transportation Group Ltd. (SNTG), contends former general counsel Paul E. O’Brien can’t sue it for wrongful discharge due to the secrecy and loyalty duties of the attorney-client relationship. But a Superior Court judge is going to let O’Brien try. The New Canaan, Conn., lawyer, whose annual base pay was $210,000, argues that ongoing criminal activity by executives in the international shipping company made it impossible for him to do his job as its top inside lawyer, effectively forcing him to leave in March 2002. O’Brien’s action dramatically highlights the dilemma faced by today’s in-house counsel, who are under increased pressure to blow the whistle on corporate misdeeds, without any guarantee of a legal remedy if doing so costs them their jobs. The shipping giant is under investigation by the U.S. Attorney’s Office in New Haven, Conn., and the U.S. Treasury’s Office of Foreign Asset Controls for trading with Iran. That country is off-limits for much trade due to its alleged sponsorship of terrorism. Earlier this year, Stolt-Nielsen admitted to entering into an amnesty program for antitrust violations in the United States and in Europe, and previously paying $95,000 in fines for trading with Sudan. In a case of first impression in Connecticut, Stamford Superior Court Judge Taggart Adams has granted the company’s motion to strike two of O’Brien’s five counts seeking release from confidentiality obligations, but allowed his claims of constructive discharge, breach of contract and tortious interference with a business expectation. O’Brien v. Stolt-Nielsen Transportation Group Ltd., No. X08 CV02 0190051 S. Ruling last month, the judge struck the complaint’s fourth count seeking a court injunction that no legal or ethical duty prevents O’Brien from disclosing “SNTG’s ongoing criminality to appropriate government agencies charged with regulating such conduct.” He also struck the fifth count, O’Brien’s request for a declaration that he is not ethically or legally prevented, “as defendant’s general counsel, from disclosing otherwise privileged information as necessary to establish his claims against SNTG in this action.” The tortious interference count is brought against Greenwich-based executive Samuel Cooperman, chairman of SNTG’s board of directors. The wrongful discharge and breach of contract counts are lodged against SNTG, which is organized under Liberian law and is a subsidiary of London-based Stolt-Nielsen S.A. The parent company reported $2.7 billion in sales in 2001. The Luxembourg-registered Stolt-Nielsen, which controls nearly a quarter of the world market for liquid-chemical transport, is under investigation for alleged price-fixing agreements with the large Norwegian shipper Odfjell S.A. to divide up much of the world tanker-transport market, according to court filings. Deep divisions States are sharply split over the policy questions raised by allowing in-house lawyers the right to sue for wrongful discharge, with the implicit right to dispense with lawyer-client confidentiality. In his decision, Adams carefully traced the legal roots of wrongful discharge-an exception to the employment-at-will doctrine-which allows employees to recover damages if their firing violated an important public policy. For a private lawyer with multiple clients, the general rule is that the attorney-client relationship is terminable by either side at any time, except during trial or where it would cause undue hardship. During the past decade, Illinois produced landmark cases denying in-house lawyers any wrongful discharge rights, reasoning that the public is adequately protected from corporate wrongdoing through lawyers’ ethical obligations alone. This classic view gives in-house lawyers no option but to fall on their swords silently, resigning without revealing client secrets, at vast personal cost. An emerging view, however, favors encouraging lawyers to “do the right thing” by giving them the right to sue if wrongfully terminated. Adams noted a 2002 Tennessee case, Crews v. Buckman Labs. Int’l, 78 S.W.2d 852 (2002), which allowed an assistant general counsel to sue for wrongful termination after notifying bar officials that her superior was not licensed in that state. Donna N. Heller of Stamford’s Finn Dixon & Herling, represents SNTG, along with John K. Weir of Greenwich. The company contended that, if O’Brien were allowed to sue, the foundation of lawyer-client trust would be irreparably damaged. Furthermore, it argued O’Brien could not possibly make his case without violating attorney-client privilege. Adams dubbed the arguments logical but premature. Exactly what ethical obligations apply to O’Brien, a member of the New York and Louisiana bars, must be established closer to trial, Adams decided. Overall, the judge opted for a right to recover for whistleblowing, finding “no rational basis for denying an employee-attorney the right available to other employees to sue for wrongful discharge when the suit is premised on protecting a well-defined public interest.” The fact that an in-house lawyer may have to resign, Adams noted, creates “a burden not often shared by non-attorney employees.” O’Brien, whose duties at SNTG included compliance with antitrust law, is represented by David S. Golub of Stamford’s Silver Golub & Teitell.

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